How would you assess all your funds are doing this year given the volatility we've seen. Well needless to say you know most of
our funds are in negative territory but we're long only where we're not long short in what I do. So that's not surprising.
We've had a good run for a few years. But you know what do we where do we go now. I guess you have.
And that's the question which I'm sure I'll get asked now. Well look I think. Let's do that. Yes. Where do you think we got
second half. Look the world is definitely still uncertain.
There is volatility. Risk is still there. The two key things still the conflict in Europe there's still Covid restrictions in
a lot of parts in Asia. So the risks are still out there. But having said that if we look at first of all the Covid
restrictions you know they get they've got to start easing right. Wherever they are. China obviously one of them. And if we
really started to see that investors are looking at good value in a lot of stocks in these areas you look at China for instance
the valuations on China today even though a lot of earnings revisions have taken place downwards you're still looking at a P
E level now into next year 10 times and that's knocking off earnings by quite a bit. But given what's happened in the last
year or so and maybe longer is it now. Do you think a China discount being built in. And if so how much is it. Yeah that's a
fair question. You know in what we do and certainly in trying to size up these risk we have taken a little bit more of a risk
premium on Chinese equities given the volatility in the last few years and certain regulatory changes. We'll have to see how that
evolves. But even if you take that little bit more of a risk premium those valuations are very cheap today and you see what's
going on locally in China. There's definitely easing which is counter of what other central banks are doing in the rest of the
world. There's definitely a footing to stimulate the economy as well is coming out you know with high rates et cetera possibly
slowing down. That's a bad time to be coming out of a recession as China has been but possibly not a recession but slowing
growth because zero export markets are not going to be very very true. But the domestic demand sector will we believe will pick
up quite strongly with the stimulus with infrastructure spending consumer savings coming back out to spend. And we've seen that
in other countries as well as Covid opens up. That's why we've got inflation is what partly is that where you most of your
conviction is right now given just how far the valuations are isn't China what do you rotate from to go back into China now.
Sure. So China China's one of our markets. We are getting more positive. We we were a bit underweight China. We're moving up
there. If we look at Hong Kong and China combined today we're actually overweight and has all China China components. But we
also like Korea and we'll pretty probably funding it a bit from Southeast Asia and India. Now again fundamentally we love these
places compounding earnings growth over multi-year periods. But if you're just looking at tactically over a six month period or
something maybe you can get some more juice out of China and maybe Korea even
in terms of taking you know determining where you take that funding from within Southeast Asia. I mean Indonesia by and
large has just beaten everyone else. This is up this year. You still like Indonesia still like Indonesia over multi years. But
it just it comes back to valuations relative valuations. OK. And as you said Indonesia has done very well. I think it's up 7
percent in the US dollars this year. Right. Commodities has obviously been a great play for Indonesia.
Macros looking good. But again relative valuations if you look at China versus Indonesia right now China is looking more
interesting India. India is trading at 19 times multiples for next year. Earnings growth the great again cheaper India.
Actually historically they have such a
late 20s. Normally it is sort of it's sort of pushing it pushing it now. But but earnings are strong. So again multi-year you
love it. But again just tactically in the short term now we're not saying we're going zero by any means. Just you know a bit
underweight. India. India been underweight. Southeast Asian funneling it into northern northern Asia. Well what I'm curious
about now is the first time in at least 15 years we've had to deal with generationally high inflation rates are moving up. We
talk about India 19 China 10 times. Do you need to start looking at those multiples with a different set of lenses right now.
Yeah just because the cost of borrowing is going up. I mean you know 10 times now is not 10 times what it was three years
loosely and being completely honest you know analysts sell side and buy side. It's it's somewhat a new phenomena to a lot of
them you know building in higher higher costs and margins you know coming down. They haven't been used for a long time in
dealing with increasing cost of inputs like this amount. So filtering that in and being very confident about those input
numbers is something we have to be very sure about. Be very robust about what when you hear the World Bank talking about
storm clouds are emerging. Stagflation is basically maybe that scenario is playing out for years to come. Is what they're
saying. How do you kind of look at equities then. I mean is there a way to kind of navigate that stagflation scenario to
you. Well I think having sort of a balanced outcome in your portfolio is just talking about equity. We've seen this rotation
into income income stocks for instance. So I think it's reminding investors that yes there are some great growth stocks
there. But having balance you know have some more income stocks as well where you get that yield element and you've got to focus
on and one should anyways focus on those companies that really have pricing power. You know they're in a strong they're in a
strong sector. They have a comparative advantage. And as prices keep going up they can pass on that to the consumer.