May 2024
Latin America is a mosaic of unique cultures, economies, and societies guided by an assortment of leaders and governments.
For those who live outside of the region that stretches from the southern border of the U.S. to Cape Horn, there’s a tendency to limit investment considerations to the countries with the largest stature—Brazil, Mexico, and Argentina. Especially among U.S.-based mutual fund and ETF companies.
But Latin America is far more dynamic beyond those three anchors, and in many ways, the differences and nuances are only evident to those born and raised in Central and South America.
With regard to investments, that depth of localized knowledge can lead to ideas and returns rooted in companies far from the biggest names in the biggest countries. That is, companies with stock that isn’t available via American Depository Receipts (ADRs), but possess promising, durable growth prospects.
Our name, OTG, stands for On the Ground, which defines the way our firm and fund managers approach investing in Latin America. We believe having a team that lives in the region (and in particular our investment portfolio managers) offers an advantage. Among its benefits:
- Highlight economic, industry, and company opportunities in a broad cross-section of markets
- Provide insights into evolving challenges and issues
- Present the interplay of sectors, asset classes, and currencies
For example, portfolio managers and analysts who are “on the ground” are more likely to be aware of key factors and risks affecting Latin American companies. Consider currencies in the region: they’re best viewed through a broad perspective that accounts for influences such as:
- Are trending in the company’s home country.
- Are acting in any country where the company does business.
- Are impacted by monetary policies—both at home and elsewhere.
- Are affected by political developments, including elections.
- Are influenced by China’s growing interest in the region.
Ultimately, currencies in Latin America are best viewed as a mosaic of influences. Our on-the-ground presence helps us interpret those factors for better investment decisions. You can view the fund’s current top ten holdings here.
Let us put our Latin American insights and experience to work for you.
OTG Latin America Fund (OTGAX): Rising region, on the ground.