| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 9.6% | 3.7% | 29.1% |
| 2025 | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| 29.1% | 2.4% | 6.9% | -27.1% | -3.2% | 14.4% |
2025 was an outstanding year for emerging markets, exceeding 25% returns and outpacing the US despite market threats including US monetary policy uncertainty and aggressive tariff measures. The extraordinary strength of AI-related stocks more than offset these headwinds, with seven of the 10 largest contributors to the MSCI EM Index being AI-related and accounting for over 40% of the index's 34% return. Emerging markets are standout beneficiaries because significant portions of AI physical infrastructure are sourced from EM companies, especially Asia-based enterprises like TSMC. The AI boom is creating structural changes in the memory industry that should support higher and more consistent profitability for leaders like Samsung Electronics and SK hynix. Three key developments are transforming industry dynamics: growing demand for customized, high-value memory products; the need to overcome the memory wall for AI workloads; and increasing manufacturing capacity constraints. While AI bubble concerns persist and risks remain around infrastructure spending durability, the favorable environment for memory leaders is expected to extend into late 2026 and potentially beyond.
Emerging markets are standout beneficiaries of the AI investment wave because significant portions of AI physical infrastructure are sourced from EM companies, particularly in the memory semiconductor industry where structural changes support higher and more consistent profitability.
We think the favorable business environment for Samsung and SK hynix is likely to extend into late 2026 and potentially beyond. More importantly, we believe the structural forces behind the current super cycle will persist across multiple cycles, supporting higher and more consistent returns for the memory industry.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 20 2026 | 2025 Q4 | 000660.KS, 005930.KS, 2330.TW, 700.HK, ASIANPAINT.NS, BABA, EPAM, GLOB, HDFCBANK.NS, ICICIBC.NS, ITUB, MARUTI.NS, MELI, MMYT, PING, SE, TCOM, TCS, TSM, WALMEX.MX | AI, emerging markets, energy, Memory, nuclear, semiconductors, technology |
005930 KS 000660 KS KAP LI 688188 CH |
AI-related stocks sustained the relentless rise of the EM index, with seven of the 10 largest contributors being AI-related and accounting for more than 40%… |
| Oct 19 2025 | 2025 Q3 | 688188 CH, BABA, CATL, GLOB | AI, Automation, China, E-Commerce, emerging markets | - | Chinese equities rebounded sharply on AI investment and restructuring at Alibaba, while Indias MakeMyTrip and Taiwans Delta Electronics led sector gains. Policymakers efforts to curb… |
| Jul 16 2025 | 2025 Q2 | - | Competitive Advantage, emerging markets, local knowledge, Scale, trade friction | MELI | The letter examines competitive advantage in emerging markets amid intensifying trade friction and global competition. Management highlights local-market expertise, scale advantages, and ecosystem development as… |
| Mar 31 2025 | 2025 Q1 | 002050 CH, 2308 TT, BJAUT IN, KO, SI IN, TCOM | - | - | - |
| Dec 31 2024 | 2024 Q4 | 005930 KS, 300 HK, 5274 TT, 601012 CH, 603290 CH, BUPA, EMAAR, TSM, WEGE3 BZ | - | - | - |
| Sep 30 2024 | 2024 Q3 | 002050 CH, 669 HK, ALGR, B7F0 GR, BH TB, CLS SJ, MOGI, TLK, WALMEX MM | - | - | - |
| Jul 18 2024 | 2024 Q2 | 002050 CH, 1590 TT, 5274 TT, HDFCLIFE IN, IBN, LZRFY, TSM | - | - | - |
| Apr 15 2024 | 2024 Q1 | AAGIY, BUHPY, HDB, KSPI, MELI, TLK, TSM, WALMEX MM | - | - | - |
| Jan 31 2024 | 2023 Q4 | 000333 CH, 002050 CH, 002594 CH, 2331 HK, 300750 CH, 4BB GR, 601012 CH, 601888 CH, ALGM, HDFCLIFE IN | - | - | - |
| Jun 30 2023 | 2023 Q2 | 3CY6725 KS, 601100 CH, DLELY, EMAAR UH, WEGZY | - | - | - |
| May 31 2023 | 2023 Q1 | 005930 KS, 2269 HK, GLOB, KSPI LI, MSIL IN, TCS IN, TSM | - | - | - |
| Mar 3 2023 | 2022 Q4 | - | - | - | - |
| Jun 30 2022 | 2022 Q2 | 002050 CH, 035420 KS, 1476 TT, ABEV, EPAM, TCS IN | - | - | - |
| Mar 30 2022 | 2022 Q1 | 000333 CH, CATL LN, D3H GR, EPAM, SXC GR, TS | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
MemoryThe AI boom is engendering structural changes in the memory market that should support higher and more consistent profitability. Three key developments are changing industry dynamics: growing demand for customized, high-value memory products like HBM; the need to surmount the memory wall for AI workloads; and increasing constraints on memory manufacturing capacity as more capacity is allocated to HBM production. |
DRAM HBM Semiconductors Samsung SK hynix | |
NuclearPosition in Uranium Energy as the largest licensed uranium miner in the U.S., positioned to benefit from renewed focus on nuclear power as long-term energy solution and U.S. efforts to strengthen domestic nuclear fuel supply chains for national security. |
Uranium Mining Nuclear Power Energy Security Domestic Supply National Security | |
| 2025 Q3 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
ChinaChina's economic rebalancing appears to be moving forward. Market liquidity, anti-involution and a measured consumer policy are likely to drive a sustained market performance in 4Q. Fiscal support and ongoing reforms in China is supportive of a stronger currency. |
Growth Policy Currency | |
Emerging marketsGlobal equities, especially those outside the U.S., powered equity returns. In emerging markets, shares of companies linked to commodities were the strongest performers as commodities rallied. Even after a strong year for international and emerging markets shares, we still see some of the best value in the world in these areas. |
International Commodities Non-US Best Value | |
| 2025 Q2 |
Competition |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jul 16, 2025 | Fund Letters | Edmund Bellord | MELI | Marcos Galperin's MercadoLibre Inc. | Consumer Discretionary | Internet & Direct Marketing Retail | Bull | NASDAQ | Credit, ecommerce, Logistics, Payments, scale | Login |
| Jan 20, 2026 | Fund Letters | Edmund Bellord | 005930 KS | Samsung Electronics Co., Ltd. | Information Technology | Semiconductors & Semiconductor Equipment | Bull | New York Stock Exchange | AI, Capacity, DRAM, HBM, Pricingpower | Login |
| Jan 20, 2026 | Fund Letters | Edmund Bellord | 000660 KS | SK hynix Inc. | Information Technology | Semiconductors & Semiconductor Equipment | Bull | New York Stock Exchange | AI, cashflow, HBM, Margins, NVIDIA | Login |
| Jan 20, 2026 | Fund Letters | Edmund Bellord | KAP LI | National Atomic Company Kazatomprom | Energy | Uranium | Bull | New York Stock Exchange | Aipower, cashflow, Costleadership, Nuclear, uranium | Login |
| Jan 20, 2026 | Fund Letters | Edmund Bellord | 688188 CH | Bochu Technology Co., Ltd. | Information Technology | Software | Bull | Shanghai Stock Exchange | Automation, Industrialsoftware, Lasers, manufacturing, productivity | Login |
| TICKER | COMMENTARY |
|---|---|
| 000660.KS | SK Hynix has solidified its leadership in high-bandwidth memory (HBM), emerging as the exclusive HBM supplier for Microsoft's in-house AI accelerator and securing roughly two-thirds of NVIDIA's anticipated HBM4 demand for its next-generation platforms at meaningfully higher price points and margins than prior generations. |
| 005930.KS | Top gainers included Samsung (+38% in U.S. dollar terms) |
| 2330.TW | Taiwan's TSMC fabricates it. TSMC, the world's largest semiconductor foundry |
| BABA | Alibaba was a detractor during the quarter after the company reported mixed fiscal Q2 results. While cloud revenue growth accelerated and margins remained stable, the core commerce business struggled with slowing growth and significant profit pressure, particularly in the quick commerce segment where heavy investment and intense competition led to a sharp decline in profitability. |
| EPAM | I continue to believe that DAVA is undervalued relative to peers who face similar AI threats as DAVA, such as EPAM. |
| GLOB | The capital was reallocated to Globant, an Argentinian digital engineering services leader. Macro headwinds and market concerns around AI's potential impact on digital services business models drove a significant drawdown in 2025, with the stock de-rating to 10x forward earnings – its lowest valuation in history, and a substantial discount to its historical average of 30x. Today, Globant's project pipeline stands at $3.7b, versus 2025's revenue of $2.5b, and we expect the company to grow earnings at a high single-digit rate. |
| ITUB | Our portfolio is full of examples, whether that's Pedro Moreira Salles at Itaú Unibanco |
| MELI | E-commerce Volatility: turbulence in our e-commerce portfolio companies, Sea Ltd (Southeast Asia) and MercadoLibre (Latin America), amidst aggressive price wars. |
| MMYT | MakeMyTrip, India's leading online travel booking portal, has been a much better investment than Britannia Industries, India's leading biscuit brand, over the past three years. |
| SE | During the quarter, we initiated a new position in Sea Limited, a Southeast Asian consumer internet company with an integrated ecosystem combining e-commerce, digital payments, and entertainment. Sea has a diversified business model, with its Shopee e-commerce platform, a mobile-centric marketplace that provides integrated payments, logistics infrastructure, and seller services. |
| TCOM | Trip.com was mentioned as a larger position that contributed little despite positive operating progress, representing opportunity cost. |
| TSM | TSMC was a top contributor during the quarter, driven by robust demand for advanced semiconductor manufacturing and improved gross margins as AI continues to grow strong and the non-AI segment showed signs of recovery. Management raised its revenue growth guidance to the mid-30% range, and given continued strength in demand, AI-related growth targets are expected to move above the current mid-40% level. |
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