International Assets Advisory Leverages Old School Contacts

 During the 40-odd years that it’s been in existence, Orlando, Fla.-based International Assets Advisory has developed a suite of longstanding relationships with sources in many different countries, sources that today, help the firm in assessing the viability of investment opportunities in various markets across the globe.

“Back in the day before the advent of the Internet, you had to get your information directly from sources,” said Jeffrey Winn, managing partner at International Assets Advisory, “but although today you can get almost all the information you need from the Internet, nothing replaces that direct contact.”

Being able to speak to people on the ground in different countries helps International Assets Advisory in determining where and how it’s best to invest in different jurisdictions.

Evidently, international markets make up a far larger percentage of the global investable universe than the United States, and the growth of GDP is also far more significant outside the U.S. But getting the best results from international investing doesn’t necessarily mean investing directly in all foreign markets, Winn said, even if they happen to be the fastest growing markets in the world.

Take China, for example.  Although it’s a leading economy, “we think there are far too many risks in buying China and Chinese companies directly and it’s difficult to trust the data out of China,” Winn said. “For China, we prefer the side door approach, where you’re not getting directly involved and caught up in anything overly complicated, but are still getting the benefits of the growing Chinese middle class, for example, by investing in multinational companies like Nike or Starbucks. There are also some Chinese property developers that trade in the U.S. that we like and for which we can get fundamental data that we can believe.”

In other cases such as Europe and other developed markets as well as some emerging markets, Winn favors a more direct approach, “because we’re not uncomfortable with data from places like Australia, Singapore. London and so on, so if we find a company that’s undervalued, we will buy it directly.”

Value is key to the firm, which caters toward clients who are investing their retirement dollars. As such, the investment focus is long-term, Winn said, “and speculative money is not our strong suit.”

International Assets Advisory uses a combination of mutual funds, ETFs and unit trusts to invest its clients’ money, but in some cases, where clients have additional funds and a greater understanding of markets, the firm will purchase individual stocks directly. Although it places a high priority on investing internationally, Winn is also firm in stating the importance of the United States to International Assets Advisory. The U.S., in fact, is still in the “leadership role” the firm has had it in for the past five years, he said, because of the value proposition that many American companies offer.

However, International Assets Advisory is also looking increasingly toward Europe, where many companies are now looking extremely attractive.

“I wouldn’t be surprised if in 2014, Western and Continental Europe become the undervalued investment destination to be in,” he said. “The U.S. is still at the right price, but now, there are also many opportunities in Europe, where companies are trading low, and you can buy, for example, a company like Siemens for 30% less than you can buy GE.”

International Assets Advisory allocates between 10% and 50% of its clients’ portfolios to international markets.