Weekend Reads for Global Investors: Insights from Mark Mobius and More
(I am surprised that no conspiracy theorists have yet advanced the theory that the Saudis are good chartists and picked the perfect timing for oil prices to break through the neckline of the double bottom formation. That is, for those of us not as eloquent in technical analyst speak, they picked the precise moment to give oil prices a push so that they will continue to go up from here.)
Movements of this magnitude, though, are usually nothing more than noise that long-term investors should tune out. The event more deserving of your attention could be Buffett’s glowing endorsement of the Heinz-Kraft merger. It is worth reading about because it is a live case study of how Buffett implements his investment philosophy: buying great companies at fair prices. Apparently Buffett thought the market had undervalued Kraft by a significant margin. Do you think the price is right?
There was a series of events in recent weeks related to the proposed Asian Infrastructure Investment Bank (AIIB) that probably was not on many investors’ radar screens. (AIIB seems to have aroused more interest among politicians than investors.) I thought I’d mention it here not because I think it will have much market impact in any meaningful way any time soon, but rather because it is consistent with something I discussed in a couple of blog posts earlier this year.
Namely, in today’s world, where much of emerging market investments come from developed countries, an emerging market won’t graduate from its “emerging” status until it fully adopts the rules and market institutions jointly established by investors in the developed markets. This won’t change until the net worth of the “emerging markets” reaches levels similar to those of developed markets. China is nowhere near “developed” status in that regard, but it is apparent how much influence money can buy. The United Kingdom, Germany, France, Italy, Switzerland, and now Australia have all broken ranks with the Obama administration and declared an interest in joining the AIIB.
Below are some of the interesting reads I have come across in recent weeks, including insights from investment luminaries such as Mark Mobius.
- “Buy Signal? Buffett Says Heinz-Kraft Merger Is ‘My Kind of Transaction’” (MarketWatch)
- “Oil Leaps 5 Percent, Most in a Month, on Air Strikes in Yemen” (Reuters)
- “China’s AIIB: What You Need to Know” (The Corbett Report)
- “UK Support for China-Backed Asia Bank Prompts US Concern” (BBC News)
- “A Rebuff of China’s Asian Infrastructure Investment Bank is Folly” (Financial Times)
- This seems obvious but it never hurts to do a sanity check once in a while: “A Bond ‘Bubble’ Is Very Different from a Stock ‘Bubble’” (Pragmatic Capitalism)
- This is another obvious question that every investor should think about: “What Constitutes Long-Term in the Stock Market?” The answer may not be quite so obvious in this case. (A Wealth of Common Sense)
- Many of our readers left very positive comments after reading our primer on multi-asset strategy. Check out insights from some of the world’s largest and most sophisticated institutional investors on the subject in the second and third articles in the miniseries: “Three Key Decisions in Formulating an Asset Allocation Strategy” and “An Advance in Portfolio Construction.” (Enterprising Investor)
- “Art and Fear and Investing” (Millennial Invest)
- One perspective on the taper tantrum: “The EM Sell-Off Is No Taper Tantrum Sequel” (Financial Times)
- Others are prepared to stay away, whether you call it taper tantrum or not. “Emerging Markets That Are Vulnerable to Rising Interest Rates by the Fed” (Seeking Alpha)
- Mark Mobius opines on Islamic finance: “Opportunities in Islamic Finance Grow?” (Franklin Templeton Investments)
- Australia became the latest developed country expressing an interest in joining the AIIB. “Australia Ready to Join China-Led Bank, Seeks Clarity on Governance” (Reuters)
- “Have Emerging Markets Emerged?” (Enterprising Investor)
- “Where to Invest in Emerging Markets: Lessons from the Taper Tantrum” (Enterprising Investor)
The Soft Side of Business
- This seems a fun way to learn something together: “How to Get Your Team to Coach Each Other” (Harvard Business Review)
- “The Most Important Leadership Skill There Is” (Huffington Post)
- This might seem easy to the pros. If you are like me, though, this takes much practice. “Meetings: When to Present and When to Converse” (Harvard Business Review)
And Now for Some Reading Truly for the Weekend . . .
- “Seven Tips for Staying Balanced in Business and Life” (Entrepreneur)
- “Going to a Top Business School Will Now Cost You Up to $99,000 Per Year.” Really? (Bloomberg)
- “How to Determine the Number of Calories You Should Eat to Lose Weight” (Lifehacker.com)
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All posts are the opinion of the author. As such, they should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute or the author’s employer.
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