Robeco’s $18 Billion Stock Picker Bets on Argentina After Hiatus

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePMN BusinessRobeco's $18 Billion Stock Picker Bets on Argentina After HiatusIt took nearly a decade for one of Europe’s biggest emerging-market investors to return to Argentine stocks.Author of the article: You can save this article by registering for free here. Or sign-in if you have an account.qoe0cpr(1vbrrx(vn}k5mk(e_media_dl_1.png Bloomberg(Bloomberg) — It took nearly a decade for one of Europe’s biggest emerging-market investors to return to Argentine stocks.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountWim-Hein Pals, head of emerging markets at Robeco Institutional Asset Management, hadn’t touched them since selling his last holding nine years ago. This time, he didn’t wait for MSCI Inc. to add the South American country back to a closely-followed benchmark index before buying in again. He started amassing a position in the first quarter of this year and has added to it ever since.Pals, who oversees $18 billion, found his catalyst in Argentina’s energy boom. Fueled by the Vaca Muerta shale formation, rising exports helped the nation reach a record energy trade surplus in the first half of the year.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try again“Argentina has a huge net export of energy and, to a certain extent, is the beneficiary of high oil prices,” said Pals. That “helps the trade surplus, helps the currency. It’s sort of a catalyst for the whole country.”Pals, who joined the Rotterdam-based firm in 1990, also pointed to President Javier Milei’s economic reforms, which have been touted by ratings firms in recent credit upgrades. He has exposure to shares of Argentine energy and financial companies listed in the US.The position in Argentina, to be sure, isn’t “huge,” and Pals acknowledges the political risk of Wall Street darling Milei being up for re-election next year. But he sees fundamentals improving and decided to move ahead of the passive investor crowd.Argentina isn’t his sole off-benchmark holding. Pals added Vietnam as he expects the country to attain emerging-market status by the end of 2027, unlocking passive inflows. He says Argentina may follow in 2028 or 2029.Elsewhere, Pals has taken profits in Taiwan’s chipmaker-heavy market after the strong run—up in technology shares. He is now “maximum underweight” the Asian market, with an allocation 500 basis points below its benchmark weight — a limit he uses as a rule of thumb. “Some of them tripled, quadrupled,” Pals said referring to stock prices. “We took money off table.”Enthusiasm for companies tied to the artificial intelligence supply chain has propelled Asian technology stocks. It has reached the point where just three companies — Taiwan Semiconductor Manufacturing Co., Samsung Electronics Co. and SK Hynix Inc. — account for more than 30% of the MSCI Emerging Markets Index.While the outlook remains bright for many of these companies, Pals is mindful of concentration risks.That’s led him to be underweight Asia, an atypical move in his fund’s 32-year history. The Robeco Emerging Markets Equities Fund has outperformed 84% of its peers over the past five years, according to Morningstar Inc. data. This year, it has beaten 60% of them.Poland, Hungary and Greece are among his favorite markets in Europe. His largest regional overweight, meanwhile, is Latin America, where he favors countries from Mexico to Peru.“We don’t see EM as a leveraged play on AI,” Pals said. “It’s much more than that.”—With assistance from David Feliba and Jonathan Gilbert.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.