August 20, 2017

A Hedge Fund Manager as Comic Book Hero?

Although hedge fund managers are unlikely comic book heroes, Mark Mobius uses the medium to explain investing in emerging markets.

Hedge funds are getting a bad rap in today’s economy. People think they’re riding the recession to the bank or even causing some of the calamity. The truth is more grey and worth looking into. From providing liquidity and capital when it otherwise dries up and making the market more efficient are two plusses they bring to the markets.

One fund manager has taken an unprecedented step in starring in his own graphic novel. A hedge fund manager as comic book hero? Much like hedge funds generally, it’s worth taking a deeper look. Jonathan Burton of The Wall Street Journal‘s MarketWatch provides some insight on the fund manager and his alter-ego. Oh, and you can see some of the comic here.

Mark Mobius may be the only mutual fund manager ever to be the subject of a comic book, and certainly the only one to earn the title of “Father of Emerging Markets Funds.”

The Thai edition is sold out, but of the Japanese manga comic is available in Chinese, Korean, Japanese, Indonesian, and English.

Such is the mystique of Mobius, a pioneer investor in emerging markets, builder of the BRICs, and an early believer in the power of globalization and the potential for developing Asia, Latin America, the Middle East and Africa, as well as Russia, to compete on the world stage.

As Chairman of Templeton Emerging Markets Group, a unit of mutual-fund Franklin Resources Inc., Mobius oversees $40 billion in assets.

Mobius is a confirmed euro bull. “There are challenges, such as member countries’ need to control government spending, but I believe the euro should be very successful and could possibly play a greater role in the global economy in 2020,” Mobius said.

A robust European currency would be a plus for emerging nations that are major exporters to Europe. Even without this tailwind, Mobius points out, many emerging economies sport impressive growth rates of three or four times that of developed markets. These countries also have little debt and high levels of foreign reserves.

“These fundamental strengths are likely to continue in the months and years ahead, and eventually be reflected in the earnings and share prices of emerging-market companies over time.”

Mobius has positioned his funds’ portfolios for any possibility. He’s invested in cyclical areas such as energy, commodities and materials, as well as having large investments in food and other staples that wealthier consumers can now afford.

And as someone who has seen emerging markets boom, bubble and bust, Mobius is also realistic about the need for investors in these parts of the world to show tremendous patience — which he said will be rewarded.

Emerging market investors also can add liquidity and stability to a growing nation. After crippling Britain with his bet on the pound, George Soros sought to help many countries through his investments. Hedge funds don’t deserve all the blame they get for financial crises. An excellent book on the subject is More Money Than God, by Sabastian Mallaby. I don’t get any money for recommending it. I’m almost done with it and it is a fair and entertaining summary of the industry.

Mark Mobius is on a quest to educate and a great way to do that is through comic books. Emerging markets can use all the help they can get. So is it too much to picture a hedge fund manager as comic book hero? Ask Mobius’s investors.

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