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| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
|---|---|---|---|---|---|---|---|
Buyside Digest is not affiliated with, and does not endorse, Rondure New World Fund. This analysis is provided for institutional research purposes only and is not investment advice.
"Rondure's emerging markets strategy outperformed in Q1 2023 despite banking sector turmoil, benefiting from underweight financials positioning and strong performance in Mexican transportation, Latin American e-commerce, and select Asian technology stocks. The manager maintains cautious positioning due to valuation concerns while staying overweight Mexico and Southeast Asia, positioning for China reopening benefits and post-Covid travel recovery opportunities."
Rondure delivered strong Q1 2023 performance with the New World Fund returning 4.96%, outperforming its benchmark by 116 basis points. The quarter was marked by significant banking sector turmoil, including the collapse of several U.S. banks and Credit Suisse, creating the most serious banking crisis since 2008. Rondure's underweight position in financials proved beneficial as the sector underperformed. Key contributors included Mexican transportation stocks benefiting from post-Covid travel recovery, MercadoLibre's continued e-commerce growth in Latin America, and select Indian technology companies. The manager maintains a cautious outlook, citing concerns about valuations and hidden risks beneath seemingly stable market surfaces. They remain overweight Mexico and Southeast Asia, positioning for China's reopening benefits while monitoring U.S.-China relations as a critical variable. The strategy focuses on quality companies with strong balance sheets, consistent dividends, and competitive moats, avoiding deep value stocks that don't fit their process. Geographic diversification proved valuable in avoiding direct exposure to Silicon Valley banking drama.
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Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.
Market Conviction
The letter demonstrates moderate-high conviction through specific position sizing discussions, named holdings with detailed thesis explanations, and clear regional overweight positions. The manager provides specific commentary on 16 individual holdings with conviction statements about longer-term theses, though some hedging language around market conditions prevents a higher score.
Growth Outlook
The manager expresses caution about market conditions, noting that 'not far below the surface, we still feel a deep sense of unease that neither the real economy nor financial markets are on entirely firm footing.' They acknowledge recent bullish behavior but maintain skepticism about underlying stability.
Risk Appetite
Portfolio positioning reflects measured caution with selective overweights in specific regions (Mexico, Southeast Asia) but explicit statements about maintaining 'trademark caution in outlook and positioning' and not being 'ready to run off to the races quite yet' due to valuation concerns.
Capital Deployment
The manager explicitly states they have 'taken some profits' in Thai hospitals and Mexican airports, indicating some harvesting activity. Combined with maintaining 'trademark caution' and not being 'ready to run off to the races,' this suggests modest de-risking rather than aggressive deployment.
Forward Guidance
The manager shows selective optimism about specific opportunities, particularly excited about Southeast Asia holdings and monitoring India for attractive entry points, while maintaining overall cautious deployment stance until valuations improve.
Language Signal
Language is dominated by risk-focused terms including 'unease,' 'caution,' 'hidden risks,' 'banking crisis,' and 'not entirely firm footing,' balanced somewhat by selective positive language around specific regional opportunities and post-Covid recovery themes.
Perceived Risk
High perceived risk is evident through extensive discussion of banking sector instability, hidden risks 'lying beneath' market surfaces, concerns about U.S.-China tensions, and explicit warnings about systemic risks. The manager devotes significant attention to identifying and discussing multiple risk factors affecting markets.
Opportunity Density
The manager sees selective opportunities in specific regions and themes (Mexico, Southeast Asia, post-Covid recovery) but emphasizes the need for selectivity due to valuation concerns. They note 'few exceptions' where valuations warrant increased risk, suggesting a moderately constrained opportunity set.
Time Horizon
The strategy demonstrates a multi-year investment horizon with statements about holding companies 'over many years,' maintaining conviction in longer-term theses despite short-term volatility, and focusing on quality companies with sustainable competitive advantages. The approach emphasizes patience over near-term catalyst dependency.
