13 Questions for Redwheel's James Johnstone

Morningstar

In this series of short profiles, we ask leading fund managers to defend their investment strategies, reveal the biggest risks to the bull market, tell us their unpopular investment opinions, and discuss what they’d never buy.

This week our interviewee is James Johnstone, Portfolio Manager of the Morningstar 5-star rated Redwheel Next Generation Emerging Markets Equity Fund.

Describe Your Investment Strategy

We seek outgrowth at a reasonable price over the next 10 to 20 years. For example, I first researched Taiwan Semiconductor Manufacturing Company (TSMC) as a $22 billion (£17.4 billion) company in 2001. Its market capitalisation is now $675 billion.

What Are 2024’s Biggest Investment Opportunities?

The return to real assets and the recognition the world has finite resources in commodities and people. Emerging markets provide the solutions to the world’s problems. They meet much of the world’s commodity needs and have younger populations with strong workforces, which is why our strategy focuses on emerging and frontier markets.

What Are The Biggest Risks to The Current Bull Run?

Any increase in geopolitical tensions between the West and a China/Russia/Iran-led alliance may be damaging for the global economy.

Who is the Most Inspiring Person You’ve Worked With?

Robert Friedland. I have invested in several of Robert’s mining operations over the last three decades. He has always been at the very forefront of thought leadership on how the world can transition to clean energy and combat climate change. I also owe a lot to Philip Ehrmann who was my inspirational boss at Gartmore and taught me a lot about emerging markets. 

What (if Any) Investments Fit the ‘Buy and Hold Forever’ Category?

Well, I wish I could get in my time machine and say TSMC from 2002. I think it will continue to dominate the world of semiconductors for years. For decades to come, I do not think you can get a better investment than a tonne of copper.

What Would You Never Invest in?

Never say never, but I am not a big believer in crypto.

How Worried Should Active Managers be?

Active managers should always be worried – it’s their job! I think there will always be a role for the human brain versus a machine. Everyone – be they quant machines or real people –hates the bottom and loves the top of every cycle. It is just fear and greed. Will computers of the future ignore those emotions? Ironically, active long-term managers should be able to

The full article is available here. This article was published at Morningstar Investment Managers & Funds.