G
lobal equity markets have continued
to demonstrate remarkable resilience
of late in the face of higher valuations
and increased volatility associated with
a number of new crises that have sprung
up around the globe, macroeconomic and
otherwise. In times like these, we cannot
overstate the importance of a longer-term
perspective.We are frequently asked
what we believe gives the disciplined
value investor an edge in investing, and
invariably our answer is time, patience
and the willingness to look further out
on the investment horizon for our
return.We certainly do not have an
information edge, as today investment
and company data is ubiquitous and
available instantaneously.With patient
investors in short supply, we have always
felt that we face less competition when
making longer-term commitments. In
an interview in
Forbes
magazine in late
2011, Je Bezos, the founder and CEO
of Amazon, remarked:‘If everything you
do needs to work on a three-year time
horizon, then you’re competing against
a lot of people. But if you’re willing to
invest on a seven-year time horizon, you’re
now competing against a fraction of those
people, because very few companies are
willing to do that.’We could not agree
more. Our cash position is somewhat
higher than normal, which will give us
the ability to capitalise on opportunities,
should they arise.
TWEEDY, BROWNE
Satellite manager: Global Equity
Global economic growth continues to
be slow, rewarding the long-term view
Our cashposition
is somewhat higher
thannormal
William Browne, Tom Shrager,
John Spears, Robert Wyckoff
T
he year began with a bout of risk-
aversion across markets as concerns
about contagion from emerging
market weakness and the geopolitical
developments in Russia and Ukraine came
to the fore.The unusually bad winter in
the US also a ected data releases, while
the weaker global Purchasing Managers’
Index (PMI) numbers exacerbated a
dip in investor sentiment at the start of
the year.With US data still looking on
the weak side, investors are trying to
decipher how much of this weakness can
be attributed to the poor weather.The UK
recovery continues to look meaningful.
The December PMI release was softer
than consensus, but still positive.The
unemployment rate fell to 7.1% in January.
This led the Bank of England’s Monetary
Policy Committee (MPC) to con rm in
February that it is abandoning forward
guidance linked to the unemployment
rate.The MPC’s minutes suggest that a
rate rise should not be expected any time
soon and that, when rates do start to rise,
the pace will be slow. In ation came in
under expectations.The UK Consumer
Price Index fell to 1.9%, the rst time
in ation has been under the MPC’s 2%
target since 2009.
WELLINGTON MANAGEMENT
Gilts
UK Gilts
Inflation dips below MPC target rate
for the first time since 2009
TheUK recovery
continues to look
meaningful
Haluk Soykan
THE INVESTOR CENTRE
THE INVESTOR
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