Mr. van Agtmael: Emerging Markets Management was one of the very first firms to focus and specialize on emerging markets. I co-founded the firm 23 years ago. Now we have always been a fundamental, disciplined investor in the broad array of emerging markets, where we have tried to keep pushing the frontiers both in terms of countries - but that's now pretty much covered, although we're still among the very few that invest in Africa, for example, and the Middle East, which are outside of the most known indexes - and we continue to push the frontiers in terms of the types of companies in which we invest, as we believe that it's not just the large, well-established companies about which I wrote in my book, The Emerging Markets Century, a few years ago, but especially the smaller, lesser-known companies that are in many ways the future of the emerging markets.
TWST: So you specialize in seeking the smaller, more undiscovered companies?
Mr. van Agtmael: When you are a fundamental investor what do you do? You really try, you could say, to outsmart the market because if you don't outsmart the market, you just have index or slightly below index returns because none of the index funds seem to be able to come up with index returns - especially the ETFs, which have been way below the index returns. You can only do that if your view has a chance of being better than the consensus view. We believe you have more chance of doing that when you focus on companies, countries that are either out of favor or that are very under-researched. They're less known and that's why we like that part of the universe. Another reason we like it is that the really interesting initiatives and some of the growth comes from smaller companies that are lesser known yet.
Tickers included in this excerpt: PZE, VALE
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