What is TEMIT and why is it being advertised during Friends on Sky TV?

The Templeton Emerging Markets Investment Trust (Ticker TEM), or TEMIT as it is often referred to has recently been advertising on TV. Specifically I keep seeing the adverts on whilst watching Friends in the evening. They are vague at best, to say the least, but it is afterall an Investment Trust and you can be forgiven for wanting to know exactly what Temit does!

Temit is a leading London-listed investment trust that offers exposure to the potential and dynamism of emerging markets. Which you can buy on the stock market like any other share through brokers like AJ Bell and interactive investors.

The trust is managed by Franklin Templeton, under the stewardship of Chetan Sehgalin in Singapore and Andrew Ness in Edinburgh. Managers who took over running the fund from legendary investor Mark Mobius.

What is Templeton Emerging Markets Investment Trust’s mandate?

TEMIT aims for long-term capital appreciation by investing in companies that are based in, or materially benefit from, the emerging markets.

These regions are seen as key drivers of global economic growth, making TEMIT a plausible option for investors who are looking for diversification and high-growth opportunities.

Where does Templeton Emerging Markets Investment Trust invest?

The trust’s portfolio, which is valued at around US $2.0 billion, is spread across sectors such as technology, financials, consumer discretionary and industrials.

The fund has significant exposure to countries such as China, India, and Brazil. In fact, almost 92.0% of the fund is invested in Asia or Latin America, with much smaller allocations to North America and Europe.

The fund’s biggest holdings are in Taiwan Semiconductor, ICICI Bank, Alibaba Group, Prosus NV and Samsung Electronics. Which together make up around 30.0% of the fund’s holdings.

From a geographic standpoint, investments in China, Taiwan, India and South Korea make up 65.0% of the firm’s assets.

In terms of performance, TEMIT stock has risen by +40.38% over the last five years whilst the trust’s dividend payments have grown by +9.34% in that time. TEMIT currently yields some +2.87%.

The fund currently trades at a discount to NAV or Net Asset Value of some -12.00%.

Where can you buy the Templeton Emerging Markets Investment Trust?

You can buy TEMIT through your stockbroker just as you would any other share, the shares of the Investment trust are listed and traded on the London Stock Exchange.

On average some 3.60 million shares in the trust change hands every day, meaning it’s a widely traded and liquid security.

Such is its popularity, brokers like Hargreaves Lansdown and AJ Bell have website pages dedicated to TEMIT. From which you can buy or sell the stock, providing you have an account with these brokers of course. In fact, any broker that trades London-listed equities will be able to trade for you in TEMIT

TEMIT is SIPP and ISA eligible making it a popular choice among long-term tax-efficient savers and investors.

Is Templeton Emerging Markets Investment Trust a good investment?

TEMIT has a four-star rating at Morningstar, the best possible rating at the fund research specialists is five stars. So TEMIT is towards the top of the tree but isn’t at the peak.
As is the case with many funds its performance varies over time we must also remember that past performance is no guarantee of future returns.

As we have seen TEMIT performed well over the last 5 years but even so it has underperformed its benchmark the MSCI Emerging Markets index, over this period.

However, over a 10-year view, TEMIT is way ahead of the index, suggesting that the fund lives up to its goal of long-term capital appreciation.

To my mind, TEMIT is the sort of fund that you make a thoughtful long-term allocation to, rather than something to trade short-term.

Although given its geographic, sector and stock concentrations, and its discount to NAV you could likely create a workable strategy here too.