Portfolio And Performance

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As of

Company objective

To provide long term capital appreciation for its shareholders through investment in companies listed in emerging markets or companies which earn a significant amount of their revenues in emerging markets, but are listed on stock exchanges in developed countries.

TEMIT has been helping investors access the dynamic growth potential of emerging markets companies since 1989.

More about TEMIT

Quick factsAs of 28/02/2019

Total Net Assets [further-information] £2,063.65 million
Market Capitalisation [further-information] £1,873.31 million
No of shares in issue 252,807,761
Net Gearing [further-information] 1.9%
Benchmark {{overview.quickFacts.benchmark}}
Ticker {{overview.quickFacts.ticker}}
ISIN {{overview.quickFacts.ISIN}}
SEDOL {{overview.quickFacts.SEDOL}}

ChargesAs of 28/02/2019

Ongoing Charge [further-information] 0.98%

Key dates

Launch Date {{overview.keyDates.launchDate}}
Financial Year End 31 March
Next AGM July 2019
Stock exchange announcements

Management


Investment strategy

As pioneers in emerging market equity investing, the Templeton Emerging Markets Group use their expertise, experience and local country knowledge to help them uncover emerging market companies with the potential to grow in value over the long-term.

Find out more

Risks

Like all stock market investments, you take the risk that the companies, currencies and markets that TEMIT invests in do not perform as expected. Emerging markets can be subject to significant and rapid changes in value, particularly in the short-term, so the value of your investment can rise and fall accordingly. It could mean you may get back less than you invested. Although you are free to decide at any time when to sell shares in TEMIT, you should consider it a long-term investment.

Past performance is not a guarantee or an indicator of future performance.

The companies in which TEMIT invests are, by reason of the locations in which they operate, exposed to the risk of a lack of established legal, political, business and social frameworks to support a securities markets or the imposition of trade barriers and exchange controls. They may make it difficult to sell investments or result in price changes. It may not always be possible to sell shares in investment companies such as TEMIT.

There is no guarantee that TEMIT will achieve its objective.

TEMIT can borrow money to purchase additional investments (gearing). This can increase the risk to your investment if the cost of the gearing exceeds the investment return from it.

These and other risk considerations are covered in TEMIT's annual report.

We are unable to provide any advice about TEMIT's suitability for your personal circumstances. If you are in any doubt you should speak to a professional financial adviser.

10 largest holdings As of {{portfolio.holdings.asOfDate}}

Security% of portfolio
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Portfolio Details

Sector breakdown As of 28/02/2019

SectorPercMSCI Emerging Markets Index (BM0119)
Financials 26.98 24.57
Information Technology 19.54 14.59
Communication Services 17.10 13.84
Consumer Discretionary 15.80 11.35
Energy 7.70 8.07
Consumer Staples 6.60 6.42
Materials 3.35 7.43
Industrials 2.46 5.42
Health Care 2.07 2.71
Real Estate 0.40 2.99
Utilities 0.00 2.60
Cash & Cash Equivalents -1.70 0.00

Country weightings As of 28/02/2019

CountryTEMITBenchmark
Hong Kong / China 23.46 32.12
South Korea 14.31 13.69
Taiwan 9.76 11.16
Brazil 9.31 7.62
Russia 8.73 3.79
South Africa 7.15 6.09
India 7.00 8.45
Thailand 4.35 2.43
Indonesia 3.33 2.20
United Kingdom 2.95 0.00
Rest of the world 11.34 12.46
Cash & Cash Equivalents -1.70 0.00

GEARING

TEMIT has the ability to borrow money for investment purposes. The Board has agreed that the Company may borrow up to 10% of its net assets.

Net Gearing: 1.9% as at 28/02/2019

Market capitalisationAs at {{portfolio.marketCap.asOfDate}}

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Market breakdown [further-information] As at 28 February 2019

Emerging 94.1%
Frontier 2.5%
Developed 5.1%
Total 101.7%

Portfolio Characteristics As at 28 February 2019

Number of Holdings 97
Dividend Yield (i) [further-information] 2.75%
Price to Earnings (i) [further-information] 11.00
Price to Cashflow (i) [further-information] 5.95
Price to Book (i) [further-information] 1.64
Weighted Average Market Capitalisation (i) (billion) [further-information] £ 78.56

Performance

The prices of shares and income from them can go down as well as up, and investors may not get back the full amount invested. Past performance is not a guarantee or indicator of future performance. Currency fluctuation may affect the value of overseas investments. In emerging markets, the risks can be greater than in developed markets An investment in TEMIT entails risks which are described in the annual report.


Discrete Performance to the end of the last month

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Cumulative performance as at {{performance.tables.cumulative.asof}}

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Monthly Commentary (as of 31 March 2019)

Global stock markets rallied over the first quarter, as thawing US-China trade relations and a dovish pivot in US monetary policy eased worries of a world economic slowdown. Strong portfolio inflows helped buoy emerging-market (EM) equities, though their performance lagged their developed-market counterparts.

Asian equities led regional performance across EMs. Hopes for a US-China trade deal provided a major boost for equities in China and export-oriented markets such as Taiwan.

Latin American markets rose, though they collectively lagged broader EMs. In Brazil, disappointing 2018 economic growth data and unease around the progress of a crucial social security reform capped equity returns. Meanwhile, international ratings agency Standard & Poor’s lowered Mexico’s sovereign outlook to negative from stable on concerns about the country’s growth and energy policy.

Emerging European markets advanced, with Russian equities posting some of the strongest gains. Stocks in Hungary finished higher. Elsewhere, South African equities rose.

Portfolio Changes & Positioning

We purchased some companies in the financials, information technology and consumer staples sectors. By market, we increased investments in a US company that derives much of its earnings from India and also invested in companies in China and India. Repurchases of TEMIT’s own shares also occurred. Overall, we sold some companies in communication services, consumer discretionary and energy sectors, and Peru, South Korea and South Africa from a market perspective.

Performance Attribution

Across sectors, financials, consumer staples and consumer discretionary boosted relative returns, all due to stock selection. By market, stock selection across South Africa, South Korea and Russia contributed to relative strength. Conversely, by sector, stock selection in both real estate and health care held back relative performance. Brazil drove relative weakness from a market perspective. Hungary and Peru were also relative detractors.

Outlook

Continued economic growth, increased risk appetite and the availability of compelling investment opportunities in EMs have been key drivers of recent fund flows into the asset class.

As long-term investors, we continue to focus on companies that demonstrate sustainable earnings power and trade at a discount relative to their intrinsic value and other investments available in the market.

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QUARTERLY PERFORMANCE ATTRIBUTION

Largest Contributors to Performance [further-information] (3 months to 31.12.2018)

Securities - Largest ContributorsSectorCountryTotal Effect (%)
ICICI Bank LTD Financials India 0.80
Buenaventura, ADR Materials Peru 0.70
Banco Bradesco SA Financials Brazil 0.51
CIA Hering Consumer Discretionary Brazil 0.45
Itau Unibanco Financials Brazil 0.41

Largest Detractors to Performance [further-information] (3 months to 31.12.2018)

Securities - Largest DetractorsSectorCountryTotal Effect (%)
Brilliance China Automotive Holdings Ltd Consumer Discretionary Hong Kong / China -2.33
Samsung Information Technology South Korea -0.37
Banco Santander Mexico Financials Hong Kong / China -0.27
Catcher Technology Industrials Taiwan -0.25
Sinopec Energy Hong Kong / China -0.20

Largest Contributors to Performance [further-information] (3 months to 31.12.2018)

Sector

Total Effect (%)
Materials 1.02
Health Care 0.59
Financials 0.40
Industrials 0.04
Consumer Staples -0.03
Utilities -0.28
Real Estate -0.29
Communication Services -0.34
Energy -0.43
Information Technology -0.58
Consumer Discretionary -0.89

Country - Largest Contributors

Total Effect (%)
Brazil 1.60
Peru 0.75
Indonesia 0.34
India 0.28
United Kingdom 0.12

Country - Largest Detractors

Total Effect (%)
United States -0.19
Thailand -0.25
Russia -0.27
Taiwan -0.44
Hong Kong/China -2.56

Risks

Risk Statistics (As of 31.12.2018)

1 year3 years
Alpha [further-information] -3.46 4.26
Beta [further-information] 0.93 1.00
Annualised Downside Risk [further-information] 2.68 2.24
Information Ratio (Relative) [further-information] -0.89 1.25
R2 [further-information] 92.41 93.66
Sharpe Ratio [further-information] -1.17 1.28
Annualised Tracking Error [further-information] 2.95 3.84
Annualised Volatility [further-information] 10.39 15.26
Positive Months [further-information] 4 21
Negative Months [further-information] 8 15

Pricing overview As of {{pricing.asOfDate}}

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TEMIT Dividends (Paid or Declared)

Ex dividend datePay dateDividend per share
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