The Contrarian Investor Podcast gives voice to those who challenge a prevailing narrative in global financial markets
Eric Chung, chief investment officer of Lighthaven Capital Management, joins the podcast to discuss his view that math, financial models, and algorithms are insufficient when it comes to investing.
“The widespread use of math in the investment management industry, while it can be helpful … I think there’s been some pretty significant overreliance on these things,” says Chung.
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Welcome to the Contrarian Investor Podcast. We give voice to those who challenge the prevailing sentiment in global financial markets. This podcast is for informational purposes only. Nothing on this podcast should be taken as investment advice. Guests were not compensated for the appearance, nor do they supply payment in order to appear. Individuals on this podcast may hold positions in the securities that are discussed. Listeners are urged to educate themselves and make their own decisions. Now, here’s your host, Mr. Nathaniel E. Baker.
Nathaniel E. Baker 0:36
My guest on today’s podcast is Hedi Ben Mlouka of FIM Partners. Now Hedi has been investing in frontier markets for quite a long time. And in fact, he has one of the oldest funds focused on this sector. It is of course a very interesting time in Investing. And in economics, as we all know, the Coronavirus has wreaked havoc on the economy. frontier markets, as we may know are a little bit less tied in to the major economies of the world. There are some typical emerging markets, like China and India. So, one could think that maybe this asset class is a bit better protected from events like the Coronavirus, but that is not the case according to Hedi. He tells us why this asset class is actually particularly vulnerable. And in fact, he goes into further details and tells us specifically which countries are at greater risk. But that doesn’t mean that there aren’t still compelling opportunities for investors to put capital to work. Before I roll the tape on this conversation, I want to remind you of an event that I am hosting on April 20, the first ever contrarian investor virtual conference. This will be held on a via web conference. I’m hosting this in partnership with value walk. And we actually just moved the time to 8am. So it’ll we’ll be recording this and hosting this at 8am on Monday, April 20. And I’m very excited because there are several hedge fund managers that have signed on and a couple of them have promised to present ideas that they haven’t previously shared. And I fully expect these ideas to move markets when they are discussed. And that’s why we moved this to the start of the day before The market open. To find out more about this event, you can go to contrarian pod.com slash event, contrarian pod.com slash event. And it’s all over my social media feed as well at pod contrarian on Twitter. So all that out of the way, let’s roll the tape on this conversation. Here you go.
Hedi Ben Mlouka 3:25
I’m the CEO and founder of FIM Partners. In a nutshell, FIM Partners is one of the leading frontier investors. We’ve been in existence since 2000, the end of 2008. And we’ve been investing in what we call high growth markets or frontier market by our own definition, which is basically the small emerging markets in Asia. I’m talking about Pakistan, Philippines, Bangladesh, and all of the MENA region. So that goes from the GCC countries Saudi Kuwait, Qatar, UAE, Oman, North Africa and also parts of sub Saharan Africa and I’m thinking in Nigeria and and a few other larger countries in the large countries in Africa. We are mostly in equity firm. So we basically we focus on public equities, in these markets that I just mentioned to you and we are also managing money on behalf of very large institutions globally. So from university endowments, pensions, sovereigns, because I sovereign, these are long term investors in the frontier markets. So they like obviously the opportunity said they like the growth profile, but also the fact that these economies are less integrated within the global economies and therefore offer an opportunity set which are to some extent different from what they would find in larger emerging markets, such as China in India etc. Our my approach to investing has always been to, to, to think as a business owner. And not to think like a minority, passive shareholder in any of the companies we invest in. So always want to create a very strong relationship with the management, sometimes even board members, but also understand the ecosystem of all of the companies we invest in. So, always privilege going into visiting the companies we invest in meeting, speaking to their suppliers, to their clients, to the competitors, even in the private space, etc. And that’s how I build the business. And that’s why I think we’ve been very successful investing in these in these markets. So I’ve been doing this myself for the last 20 years almost before FMI. I worked for Merrill Lynch in London, responsible for central Eastern Europe, Middle East and Africa.
