2nd Quarter 2011 Commentary - ASTON/Neptune International Fund
The Fund significantly underperformed its MSCI EAFE & Emerging Markets Index benchmark during the second quarter. The major contributor to that underperformance was Fund’s overweight stake in the Energy sector, where companies suffered against the backdrop of falling oil prices and broad growth concerns. Similar concerns also saw the Industrials and Consumer Discretionary sectors underperform. As during the first quarter, however, stronger markets towards the end of the period saw the Fund regain some relative performance and finish with strong momentum in late June.
Our investment views have not changed significantly since the end of the first quarter. We see global growth over the next few years as impressively broad-based—with approximately equal contributions coming from the "BRIC" countries (Brazil, Russia, India, and China) and other Emerging Markets. This means that the global economy will no longer be reliant on one specific economy. Thus, we remain positioned to take advantage of global growth directly through Emerging Market exposure, as well as through world class companies in developed markets that have good access to these sources of growth. Furthermore, we remain impressed by corporate strength in the major economies and have positioned the portfolio to take advantage of this potential strength as it translates into late economic cycle capital expenditures, especially through high-quality industrial companies.
Overall, we remain confident that our high conviction portfolio positioning, based on in-house economics and sector research, has the potential to generate strong returns over the long-term.
Robin Geffen, Fund Manager & CEO
Neptune Investment Management
Note: Investing in foreign markets involves the risk of social and political instability, market illiquidity, and currency volatility. Holdings in emerging markets entail the further risk of unstable legal systems, increased volatility, and even less liquidity.
Before investing, carefully consider the fund’s investment objectives, risks, charges and expenses. Contact 800 992-8151 for a prospectus containing this and other information. Read it carefully. Aston Funds are distributed by BNY Mellon Distributors Inc.