As we look to the second half of the year, global growth has become somewhat asynchronous. Europe is decelerating, while emerging markets, particularly Latin America, are struggling with a strong US dollar. As to China, the trajectory of its growth is debatable.
In the geopolitical sphere, we saw further departures from democratic traditions and a continuing drift toward “strongman” politics in several countries. The leading candidate in Brazil’s upcoming election is currently in jail. Turkey’s president assumed new powers. And as we noted in the first quarter, China’s president removed his own term limits.
As we have said in the past, our approach is to reduce our exposure to risks for which we are not being adequately compensated. Our defense against credit risk is to emphasize investments of relatively higher credit quality. Although we cannot entirely avoid duration risk, we can potentially minimize the risk by buying shorter maturity paper.
Matt McLennan and Kimball Brooker, managers of First Eagle Global Fund (SGENX), recently spoke with Advisor Perspectives to discuss the Fund’s go-anywhere approach.
First Eagle’s Global Value team has adopted the value investment philosophy first developed by Benjamin Graham and later refined by Warren Buffett.
First Eagle Funds
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