Magni Global Asset Management LLC developed the Sustainable Wealth Creation principles by researching the accounting, legal, regulatory, adjudicative, and economic structures of investible countries around the world. Its extensive research database contains data on 280 factors collected over the past 15 years. Magni uses this information to construct investible portfolios using its proprietary Country Selection Technique. Portfolios built using this process have demonstrated absolute and risk-adjusted outperformance.
International equities play ever more important roles in equity portfolios. The selection of international equity investments has traditionally relied on much the same investment analysis as is conducted on domestic securities. The impact of company analysis on equity valuations is well accepted in the industry, but this is insufficient.
When addressing international equity investments, an investor must know for a given country:
Today, country information is generally not explicitly included in investment decision making. The required information is not easy to find or to incorporate into the investment decision-making process. What is required is a systematic technique for collecting, processing, and organizing country data and organizing it into a format suitable for guiding investment decision.
Country analysis, being higher level, has much greater impact upon portfolio performance than do security analysis. In other words, Countries Matter™… a lot.