Global Investment Landscape
- Favorable conditions: low inflation, low interest rates, relatively full employment, moderate growth.
- Current valuations and margins favor investing selectively.
- Opportunities include both wide-moat businesses with room for margin expansion and earnings growth and select out-of-favor businesses with strong prospects.
- Continues towards recovery from the financial crisis.
- Opportunities include premier multinational leaders with strong, long-term global growth prospects.
- Avoid companies with tepid growth tied solely to the European region.
- Attractively valued, but opportunities and risks vary widely by country.
- Opportunities include companies increasing market share in enormous and fast growing economies such as China and India and industry-dominating businesses in Brazil and Mexico.
Rise of the Online Consumer Worldwide
- The number of internet users has doubled since 2010 to 3.5 billion and is growing at 10% per year.1
- A vast opportunity exists in the years ahead: Global online purchases are growing at 17% per year, yet account for only 7% of total retail sales worldwide.2
- Many of the best opportunities for investing in this theme are international, as 75% of online purchases occur outside the U.S.3
- Beneficiaries include Amazon, JD.com, Naspers and Alibaba.
Expansion of Global Transportation
- The movement of people and products worldwide is accelerating because of the expansion of world trade, the emerging global middle class, and the proliferation of the Internet worldwide.
- The world's transportation infrastructure has not kept pace with rising demand. For example in India, there are currently only 400 commercial passenger aircraft for 1.2 billion people.4
- Beneficiaries include ZTO Express and Safran.
Boom in College-Prep Education in Asia
- College admissions in Asia is hyper-competitive, with large numbers of students competing at early ages for a finite number of spots.
- In China, 300 million students in grades K-12 will compete for admission to top universities, with only a 3% acceptance rate versus 28% in the U.S.5
- Beneficiaries include: New Oriental Education & Technology, TAL Education and Tarena International.
Davis Select Worldwide ETF (DWLD)
High-conviction, best ideas portfolio Invests in the US and abroad, in both developed and emerging markets
Benchmark Agnostic Seeks to outperform the index, not mirror it
Low expected turnover and a strategic, long term time horizon Our long-term focus allows investments to compound
Traditional benefits of ETFs: Low cost, tax efficient, intra-day liquidity and transparent