By Scott Ronalds

The Asia Pacific is the fastest growing economic region in the world. Not surprisingly, many multinational companies are increasingly focusing on selling their goods and services in countries such as China, Indonesia, Singapore, Vietnam, and the Philippines among others, where populations, consumption and incomes are growing.

A result of this increasing globalization is that a company’s physical headquarters may say little about where it generates its revenues. This is illustrated clearly in our Global Equity Fund. The chart below shows that over 33% of the fund’s revenues are generated in the Asia Pacific (excluding Japan), yet only 20% of the fund’s investments are headquartered in the region. Many U.S., European and Japanese-based holdings, however, generate a large share of their sales in Asia as opposed to their domestic market.

Another takeaway from the chart is that the Global Fund remains heavily focused on Asian and European markets, as opposed to North America. This is a reflection of where the manager (Edinburgh Partners) is finding the best opportunities – i.e. cheap stocks.