The Titans Of Templeton
Around the airy Nassau offices of Templeton Worldwide, they're known as the Marks Brothers: Mark Holowesko, 38, and his Hong Kong-based colleague, Mark Mobius, 61, heirs to John Templeton's fabled global value-investing formula. While Sir John left fund management 11 years ago, investors still turn to Templeton's 65 funds when they want global exposure.
Plunging Asian markets have caused some Templeton funds to stumble lately. But over the long haul, investors have fared well. Over the past 3, 5, and 10 years, total returns for the group's flagships--Templeton Growth and Templeton Emerging Markets Funds--have ranked among the top third in their sectors despite their relatively high expenses. Franklin Resources, which bought Templeton in 1992 for $786 million, has helped bring in new assets by turbocharging the group's marketing.
In Asia, Franklin capitalized on Mobius' globe-trotting ways, spotlighting his shaved head in full-page newspaper ads that promote his three decades of emerging-market experience. Franklin has even dropped the Templeton open-end funds' 5.75% load for investors who patronize selected financial advisers. The stepped-up sales effort--plus bull markets in the U.S. and Europe--have helped assets rise more than fivefold since 1992, to $107 billion. Holowesko's global-equity portfolios account for $80 billion of that, with Mobius managing $14 billion in emerging-market stocks.
The cash deluge hasn't diverted them from Sir John's stock-picking strategy: Buy cheap companies that boast strong balance sheets and look ripe for change; don't worry about country allocations and currencies; and hold for at least five years.
After Asia's collapse, will a strict value formula let Holowesko and Mobius find bargains? How about the U.S. and Europe, where prices are sky-high? Personal Finance Editor Toddi Gutner and Asia correspondent Mark Clifford met with the Marks Brothers to divine their strategies.