A Distinctive View of Emerging Markets Investing

Thornburg Developing World Fund concentrates on managing the special risks associated with the emerging-markets asset class and on providing strong risk-adjusted returns—by focusing on self-funding companies that generate strong free cash flow and are not dependent on capital markets in times of stress.

Overall Approach

Managing Volatility in a Way That Matters
Founded during the financial crisis when many emerging-markets stocks were down 40% to 60%, Thornburg’s strategy attempts to create a mechanism to participate in the long-term development of the emerging markets and manage volatility in a way that matters.

Growing Businesses Tied to the Emerging-Markets Consumer Class
We want to own a portfolio of promising, growing businesses that are tied to the growth of the emerging-markets consumer class.

Companies That Can Fund Their Own Growth
We are interested in firms that can fund their own growth without having to turn to external sources, companies that are less likely to suffer permanent loss and impair investors’ capital during times of market crisis.

Countries with Limited External Dependence
Because of the more volatile nature of the asset class, we pay particular attention to the economies in which we invest. We look for countries with positive current account and foreign direct investment numbers — those less reliant on volatile stock and bond flows.

In short, we also look for financially sound, free-cash-flow generative countries with limited external dependence.

A Unique Collaborative Approach to Research
The portfolio is concentrated, with around 50-80 names, and is constructed with collaboration and input from managers and analysts across the entire Thornburg equity team.

What Makes The Fund Different?

The fund has a bias towards higher-quality companies with a more conservative capital structure and managers do not believe they need to go far out on the risk curve to capture the higher returns associated with the emerging-markets asset class.

Portfolio Construction

A Focused Opportunity Set
We tend to avoid countries and economies with high external dependence, in part to limit the portfolio’s vulnerability to currency devaluations. This cautious approach to investing in countries where we may have some concern is, we believe, more effective than currency hedging.

Three-Basket Style Diversification
We employ Thornburg’s three-basket style diversification construct:

  • Basic values are financially sound companies with well-established businesses;
  • Consistent earners are companies with steady earnings, cash flow, or dividend growth;
  • Emerging franchises are companies in the process of establishing a leading product, service, or market.

Diversification by Style, Currency, Market Cap and Geography

  • By style, using Thornburg’s basket construct
  • By currency, with sensitivity to stability versus volatility
  • By market cap, with a significant portion devoted to small-, mid-, and large-cap stocks
  • By geography, see the top ten countries under the portfolio tab above
Important Information

The Fund is offered solely to non-U.S. investors under the terms and conditions of the Fund’s current Prospectus. A copy of the full Prospectus and KIID for the Fund may be obtained by contacting the local Paying Agent through the Fund’s Transfer Agent, State Street Fund Services (Ireland) Limited or in the forms and literature section of this website. The Prospectus and KIID contain important information about the Fund and should be read carefully before investing.

Investments carry risks, including possible loss of principal. Additional risks may be associated with investments in emerging markets, including currency fluctuations, illiquidity, volatility, and political and economic risks. Investments in small- and mid-capitalization companies may increase the risk of greater price fluctuations. Investments in the Fund are not insured, nor are they bank deposits or guaranteed by a bank or any other entity.

This material constitutes a financial promotion for the purposes of the Financial Services and Markets Act 2000 (the “Act”) and the handbook of rules and guidance issued from time to time by the FCA (the "FCA Rules"). This material is for information purposes only and does not constitute an offer to subscribe for or purchase any financial instrument. Thornburg Investment Management Ltd. ("TIM Ltd.") neither provides investment advice to, nor receives and transmits orders from, persons to whom this material is communicated nor does it carry on any other activities with or for such persons that constitute "MiFID or equivalent third country business" for the purposes of the FCA Rules. All information provided is not warranted as to completeness or accuracy and is subject to change without notice.

The Fund is a sub-fund of Thornburg Global Investment plc, an open-ended umbrella type investment company with segregated liability between sub-funds, authorised by the Central Bank of Ireland (CBI) on 25 November 2011 as an investment company pursuant to the UCITS Regulations. Authorisation of the Company by the CBI is not an endorsement or guarantee of the Company by the CBI nor is the CBI responsible for the contents of the Prospectus or KIID.

To determine a fund's Morningstar Rating™, funds and other managed products with at least a three-year history are ranked in their categories by their Morningstar Risk-Adjusted Return scores. The top 10% receive 5 stars; the next 22.5%, 4 stars; the middle 35%, 3 stars; the next 22.5%, 2 stars; and the bottom 10% receive 1 star. The Risk-Adjusted Return accounts for variation in a managed product's monthly excess performance (excluding sales charges), placing more emphasis on downward variations and rewarding consistent performance. Other share classes may have different performance characteristics. © 2019 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

Administrator: State Street Fund Services (Ireland) Limited, ThornburgTA@statestreet.com

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