There is only one reason I can find that makes sense.GQG's...

There is only one reason I can find that makes sense.

GQG's largest earner is the EM fund at 0.98bps. It's also their third largest fund so is responsible for a material amount of their earnings. I would estimate around 35%.



The U.S fund isn't as material contributor to earnings as the EM fund, however the global and international positioning should be contributing towards increased earnings given the opportunistic positiong.

The market must be thinking this:

1. EM flows may have stopped or reversed.
2. USD has weakened against the AUD and may continue to do so.
3. The EM portfolio may see continued weakness and underperformance given the instability in the world.

My view is the market is currently pricing in 0 to negative growth, and even possible outflows.

Given GQG has no credit, fixed interest or alternative funds, there is nothing to really offset this loss in earnings, as their portfolios are highly geared to equity prices. That could explain why we are seeing companies like Pendal and Platinum currently performing better.

Currently the market is very worried about GQG's highly leveraged earnings to EM and global equities.

Only way we beat that is with new data.