EM Fund Stock Picks & Country Commentaries (July 27, 2025)

For those interested in “official” investment narratives about AI, Robeco has this series of research pieces and podcasts:

• 🎙️🌐 AI summer course, part 1 – AI milestones (Robeco) 25:20 Minutes – In the first podcast of our AI summer course, we trace AI’s journey from academic experiments to becoming a core driver of alpha in Robeco’s flagship quant strategies. This episode highlights key breakthroughs, innovative use cases, and how AI is reshaping investment decision-making in practical and powerful ways today.

• 🔬🌐 AI summer course, part 2 – Potential AI futures (Robeco) – Artificial intelligence is no longer a far-off idea in finance: it’s here, reshaping how investment professionals work every day. In part 2 of our AI summer course, we explore both the blue-sky ideas and the near-term upgrades already sneaking into daily workflows.

• 🎙️🌐 AI summer course, part 3 – AI momentum (Robeco) 24:35 Minutes – Who’s riding the AI wave? Which innovations are shaping investing today and tomorrow? Explore the dynamic AI trends shaping investing from 2023 through 2027 in the second podcast episode of our AI summer course, and how Robeco’s Dynamic Theme Machine ETF and incubator strategies use cutting-edge AI tools to identify emerging themes, optimize timing, and capture real-world opportunities.

• 🔬🌐 AI summer course, part 4 – AI everything (Robeco) – AI is no longer confined to research labs and tech demos. It’s delivering measurable productivity and revenue gains across industries. In part 4 of our AI summer course, we explore how AI is scaling from software into infrastructure, healthcare, manufacturing, and beyond. The race continues, but the question now is: who’s really pulling ahead?

• 🎙️🌐 AI summer course, part 5 – AI horizons (Robeco) 27:34 Minutes- What’s next for AI in investing? In the final part of our AI summer course, we join our experts and look beyond the horizon. Discover how AI developments may redefine investment roles, strategy development, and asset classes, preparing investors and the industry for a future driven by innovation and technological evolution.

For a much more nuance view or rather an AI reality check, these pieces from the alt-finance space are more interesting:

💻 ‘Catastrophic’: AI Agent Goes Rogue, Wipes Out Company’s Entire Database (ZeroHedge) July 2025 🗃️

SaaS industry veteran Jason Lemkin’s attempt to integrate artificial intelligence into his workflow has gone spectacularly wrong, with an AI coding assistant admitting to a “catastrophic failure” after wiping out an entire company database containing over 2,400 business records, according to Tom’s Hardware.

💻 Maybe AI Isn’t Going to Replace You at Work After All (OfTwoMinds blog) July 2025 🗃️

AI fails at tasks where accuracy must be absolute to create value.

In reviewing the on-going discussions about how many people will be replaced by AI, I find a severe lack of real-world examples. I’m remedying this deficiency with an example of AI’s failure in the kind of high-value work that many anticipate will soon be performed by AI.

Few things in life are more pervasively screechy than hype, which brings us to the current feeding-frenzy of AI hype. Since we all read the same breathless claims and have seen the videos of robots dancing, I’ll cut to the chase: Nobody posts videos of their robot falling off a ladder and crushing the roses because, well, the optics aren’t very warm and fuzzy.

For the same reason, nobody’s sharing the AI tool’s error that forfeited the lawsuit. The only way to really grasp the limits of these tools is to deploy them in the kinds of high-level, high-value work that they’re supposed to be able to do with ease, speed and accuracy, because nobody’s paying real money to watch robots dance or read a copycat AI-generated essay on Yeats that’s tossed moments after being submitted to the professor.

In the real world of value creation, optics don’t count, accuracy counts. Nobody cares if the AI chatbot that churned out the Yeats homework hallucinated mid-stream because nobody’s paying for AI output that has zero scarcity value: an AI-generated class paper, song or video joins 10 million similar copycat papers / songs / videos that nobody pays attention to because they can create their own in 30 seconds.

And:

Ian (“Lind, whom I’ve known for 50 years, is an investigative reporter with an enviably lengthy record of the kind of journalism few have the experience or resources to do. (His blog is www.iLind.net, ian@ilind.net)”) has spent the last few years helping the public understand the most complex federal prosecution case in Hawaii’s recent history, and so the number of documents that have piled up is enormous. He’s been experimenting with AI tools (NotebookLM, Gemini, ChatGPT) for months on various projects, and he recently shared this account with me:

“My experience has definitely been mixed. On the one hand, sort of high level requests like ‘identify the major issues raised in the documents and sort by importance’ produced interesting and suggestive results. But attempts to find and pull together details on a person or topic almost always had noticeable errors or hallucinations. I would never be able to trust responses to even what I consider straightforward instructions. Too many errors. Looking for mentions of ‘drew’ in 150 warrants said he wasn’t mentioned. But he was, I’ve gone back and found those mentions. I think the bots read enough to give an answer and don’t keep incorporating data to the end. The shoot from the hip and, in my experience, have often produced mistakes. Sometimes it’s 25 answers and one glaring mistake, sometimes more basic.”

Among Smith’s summarized conclusions is that “AI doesn’t actually “read” the entire collection of texts” and “in human terms, it gets “bored” and stops once it has enough to generate a credible response.” In other words, getting some low cost Indians or Filipinos to do more sensitive but tedious work might be a safer bet.

Smith also cited this piece:

💻 AI Has a Critical Flaw — And it’s Unfixable. March 2025 🗃️

There’s a mathematical wall that limits how smart it can get

How can investors make money from or benefit from AI? Ed Dowd, whose views on the US dollar were discussed in our July 6th post, was recently on a podcast where some interesting observations were made about both AI and crypto/stablecoin:

🎥 Ex-BlackRock Insider Reveals The Next 2008 Financial Crisis (Vandell Aljarrah) 54:30 Minutes (July 2025)

Edward Dowd is currently a Founding Partner of Phinance Technologies, a global macro alternative investment firm. He is also the author of the new book, “Cause Unknown: The Epidemic of Sudden Deaths in 2021 & 2022” (Release Date: Nov 8, 2022, Skyhorse Publishing). Edward has worked on Wall Street most of his career, spanning both credit markets and equity markets. Some of the firms he worked for include HSBC, Donaldson Lufkin & Jenrette and Independence Investments. Most notably, he worked at BlackRock as a portfolio manager, where he managed a $14 billion Growth equity portfolio for ten years. After BlackRock, he founded OceanSquare Asset Management with two former BlackRock colleagues.

Edward’s Website: https://phinancetechnologies.com/

Edward Dowd’s Twitter(X): https://x.com/DowdEdward

At around the 17:30 mark, Dowd reminded us of the dot.com bubble where many investments were repriced to zero; but all the expensively built bandwidth that was bought for pennies on the dollar led to the streaming/social media boom. He thinks the same will happen to AI, but the ultimate AI company/stock winners may or may not already exist in the future AI boom (after the current AI bubble bursts). He also reminded listeners that it won’t be Nvidia because semiconductors are or will become a commodity.

The hosts have a similar theory/prediction for the crypto market as they believe 99% of crypto currencies and companies will go to zero (except for a handful of useful ones…).

Dowd then noted that when the Dollar goes up, crypto does not do as well plus the Nasdaq likes a weak dollar. He thinks crypto will deflate and 99% will go to zero; but there will be some gems in the pullback.

At around the 30:10 mark, Dowd explained how Americans rather than foreigners will soon be funding the American deficit while the hosts explained how Tether is operating like a shadow bank for dollars and treasuries.

At the 33:55 mark, Dowd noted that Rome’s collapse happened after the legions were pulled back; but that does not appear to be happening with America’s military any time soon as the military industrial complex is still pulling the strings. In other words, the Dollar is not going away just yet.

Getting back to AI and at the 42:05 mark, Dowd again reminded listens how he saw everything being overbuilt and financed by junk bonds during the dot.com boom when the technology was not ready for primetime (e.g. we had mobile phones but no smartphones, etc.). He thinks AI is coming but not ready yet and there will be opportunities in the rubble. He also thinks we are in the beginnings of “idiotocracy” based on some of his interactions on Twitter (“AI will create a bunch of morons who regurgitate AI…”).

Finally, note that Dowd also recently made this on-point observation about AI on Telegram:

As of the end of July, more Q2 fund updates (our continuously updated post containing all funds is here) along with new research have become available starting with some non-EM pieces:

• 🔬🌐 Central bank watcher: Take a break (Invesco) – With the summer break underway in Europe, the four major central banks appear to be in wait-and-see mode.

  • Double trouble looms for the Fed

  • The ECB remains well positioned

  • The BoJ is still waiting for impact

• ⏰🎬🌍 Navigating EU ESG Rules and Defence Financing Priorities (Morningstar) Jul 29 2025, 1:00pm, Duration: 60mins

  • How are evolving EU priorities — from defense to the Green Deal — impacting your investment decisions?

  • Join Morningstar Sustainalytics’ specialists to gain valuable insights into navigating EU ESG rules and defense financing priorities — and their implications for APAC investors.

  • Topics we will explore:

    • EU ESG Regulations for Defense Investments: Gain a clearer understanding of ESG rules related to investing in defense.

    • ESG Risks in Defense Companies and ESG Fund Positioning: Gain insights into the ESG risks in the defense sector and ESG funds’ exposure.

    • Controversial Weapons: Distinguish controversial weapons from other military and defense sector involvements.

• 🗄️🌏 Abrdn Asia Focus PLC (LON: AAS)’s June monthly factsheet (detailed economic and portfolio) for this high conviction portfolio of Asian small caps discussed or mentioned:

  • 📈🇹🇼 Chroma Ate Inc (TPE: 2360) – Taiwanese automated testing company. Semiconductor testing for AI-artificial intelligence. 🇼 🏷️

  • 📈🇹🇼 Taiwan Union Technology Corporation (TPEX: 6274) – Value-added materials & advanced mass lamination service to the global electronics industry.

  • 📈🇮🇳 Kfin Technologies (NSE: KFINTECH / BOM: 543720) – SaaS based end-to-end transaction management, channel management, compliance solutions, data analytics & digital services to asset managers. 🏷️

  • 📈🇮🇳 Cholamandalam Financial Holdings (NSE: CHOLAHLDNG / BOM: 504973) – Vehicle finance, loan against property, home, SME loans + secured, business & personal, & consumer & small enterprise loans + general insurance services. Subs. of the Murugappa Group. 🇼

  • 📈🇰🇷 HD Hyundai Marine Solution (KRX: 443060) – Integrated engineering-based services to Hyundai brand ships. 🇼 🏷️

  • 📈🇰🇷 Park Systems Corp (KOSDAQ: 140860) – Atomic force microscopy systems.

  • 📈🌐 LEENO Industrial (KOSDAQ: 058470) – Testing components for IC production, test & analysis.

  • 📉🇨🇳 Tongcheng Travel Holdings (HKG: 0780) 🇰🇾 – Online travel industry. 🏷️

  • 📉🇮🇳 J B Chemicals and Pharmaceuticals Ltd (NSE: JBCHEPHARM / BOM: 506943) – Wide array of pharmaceutical products & solutions.

  • 🏧🇭🇰 Hang Lung Group Limited (HKG: 0010 / FRA: HLU / OTCMKTS: HNLGF / HNLGY) – Investment holding company. Property development for sales & leasing & management of car parks, properties & dry cleaning businesses. 🇼

  • 🏧🇮🇳 🇱🇰 ITC Hotels Ltd (NSE: ITCHOTELS / BOM: 544325) – Hotels, resorts & hospitality education. 6 brands in the luxury, boutique premium, upper upscale category, midscale & heritage leisure space. 🇼 🏷️

  • 🏧🇹🇼 Chung-Hsin Electric and Machinery Manufacturing Corp (TPE: 1513) – Manufacturing electric motors & generators. Power equipment, engineering & parking management services.

  • 🏧🇮🇳 Aegis Vopak Terminals Ltd (NSE: AEGISVOPAK / BOM: 544407) – Storage & terminalling facilities for LPG & chemical products.

  • 🏧🇹🇼 🇨🇳 Momo.com (TPE: 8454) – Taiwan’s leading online retail brand, TV shopping channel & TV shopping mobile app. 🏷️

  • 🇭🇰 Hang Lung Properties Ltd (HKG: 0101 / FRA: AOP / OTCMKTS: HLPPY / HLPPF) – Top-tier property developer. Luxury positioning under the “66” brand. Subs. of Hang Lung Group Limited (HKG: 0010 / FRA: HLU / OTCMKTS: HNLGF / HNLGY). 🇼

  • 🇮🇳 Aegis Logistics (NSE: AEGISLOG / BOM: 500003) – Integrated oil, gas & chemical logistics solutions provider.

• 🗄️🎬🌏 Asian Frontier Markets Update 24th July 2025 (Asia Frontier Capital) 1:19:54 Minutes (July 2025)

  • 00:00 – Thomas Hugger – Introduction

  • 02:15 – Ruchir Desai – AFC Asia Frontier Fund

  • 21:13 – Ahmed Tabaqchali – AFC Iraq Fund

  • 43:14 – Scott Osheroff – AFC Uzbekistan Fund

  • 50:04 – Vicente Nguyen – AFC Vietnam Fund

  • 01:03:27 – Q&A