Quality Growth Boutique

The Chinese government has recently instigated a far-reaching crackdown on privately-owned businesses in China. Chinese shares listed on foreign exchanges have reacted more negatively than A-shares to this increased government intervention. What risks does this pose to foreign investors and how can they prudently navigate the equity markets of China and Hong Kong?

High-growth, high-momentum stocks were among the best performers of 2020, then value stocks rallied into the first quarter of this year. We are cautious of valuations, as some stocks have already priced in a recovery. Investing in quality companies with predictable earnings power at reasonable valuations can help investors prepare for a rainy day.

Why should investors care about ESG and why has the focus on ESG increased over the last several years? We believe the answer lies partly in the uncertain times in which we live. ESG shines a light on stability. It is not a luxury, but a critical part of risk management.

Unlike horses that need blinders to keep them narrowly focused on winning a race, investors should expand their field of vision to consider the risks around them. Matthew Benkendorf, CIO of the Quality Growth Boutique, shares 5 principles that are critical to help successfully navigate emerging markets.