Extract from the full Edison Report on 13 December 2023
Why consider TEMIT?
Looking at a range of TEMIT’s quality, growth and valuation factors, the trust could be considered as a ‘quality value’ fund. This ties in with the managers’ approach of seeking companies with sustainable earnings growth potential that are trading at a discount to their intrinsic values. When required, they can draw on the resources of Franklin Templeton’s large, locally based emerging markets investment team.
TEMIT’s managers can draw on the deep resources of Franklin Templeton, which is the sixth-largest independent asset manager in the world”
TEMIT’s portfolio is actively managed, and bottom-up stock selection means that industry and geographic allocations are differentiated from those of the benchmark. The trust’s largest overweight sector is technology, while its largest underweights are consumer staples and utilities, which are both defensive. This suggests that the trust should be well positioned for an economic recovery.
As a result of economic uncertainty and macroeconomic events in recent years, investor risk aversion is elevated. This is reflected in TEMIT’s double-digit 13.3% discount, which is wider than the trust’s historical averages. There is significant scope for TEMIT to be afforded a higher valuation if investors become more interested in the positive growth and valuation attributes of emerging markets and/or the trust’s relative performance continues to improve.
TEMIT: Broad EM exposure from a well-resourced team
When required, TEMIT’s managers can draw on the deep resources of Franklin Templeton, which is the sixth-largest independent asset manager in the world with more than £1tn of assets under management. The company has been investing in emerging markets for more than 35 years and its emerging markets team of 75+ investment professionals research more than 700 securities. Franklin Templeton views its local presence in 13 emerging market countries as a competitive advantage in terms of building relationships and gaining valuable insights.
TEMIT’s managers can draw on the deep resources of Franklin Templeton, which is the sixth-largest independent asset manager in the world”
TEMIT’s managers seek to capitalise on long-term structural opportunities by identifying companies with sustainable earnings power that are trading at a discount to their intrinsic worth. ESG analysis is an integral part of the investment process. Looking over the long term, from the date of TEMIT’s launch in June 1989 to end H124 (30 September 2023), the trust’s NAV total return of +3,832.7% is substantially higher than the benchmark’s +1,698.1% total return.
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Meet the Team
Unparalleled Emerging Markets Experience
Chetan Sehgal is the lead portfolio manager of Templeton Emerging Markets Investment Trust (TEMIT). He has been a portfolio manager and senior research analyst for TEMIT since 2015. He is also a senior managing director and the director of portfolio management for Franklin Templeton’s Emerging Markets Equity Team.
Chetan was joined by portfolio manager Andrew Ness on 17 September 2018. Andrew is a seasoned investor with over two decades of experience as an emerging markets equity portfolio manager, and a strong alignment with the investment approach and philosophy utilised in the management of TEMIT’s portfolio.
Chetan Sehgal, CFA
Senior Managing Director, Director of Portfolio Management
Andrew Ness
Portfolio Manager, Franklin Templeton Emerging Markets Equity
The TEMIT portfolio management team are supported by an experienced team of over 80 dedicated emerging markets investment professionals located across 20 offices around the world.
How to Invest with Us
Shares in TEMIT qualify as an investment which can be held through an ISA. TEMIT is available through a stocks and shares ISA from a number of different companies. Your financial adviser will be able to give you full details of the options available to you.