Top global fund manager names 3 wide moat & growth shares to buy

Some of these white hot tech names shares you might not have even heard of.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

A lot of Australian investors will rightly be interested in investing in overseas share markets, as markets like the U.S. offer most of the world's best companies, while Asian markets for example offer exposure to one of the great investing trends of the future – the rise of the Asian middle class. 

One exchange traded fund that offers exposure to both these thematics is the WCMQ Global Growth Fund (ASX: WCMQ) that invests in 20-40 stocks globally under the management of established California-based stock pickers WCM Investment Management.

The fund's responsible entity and backer in Australia is Switzer Asset Management which is a wholly owned subsidiary of Contango Asset Management that is run by Marty Switzer the son of popular business personality Peter Switzer. 

The WCMQ Global Growth Fund has only been running since August 2018, but is already well ahead of its MSCI All Country World total return benchmark in returning 8.53% versus the benchmark's -0.58%.

As an asset manager WCM runs multiple different funds and defines it's guiding philosophy as: "WCM seeks quality growth businesses with superior growth prospects, high returns on invested capital, and low or no debt. Our team also requires each company to maintain a durable competitive advantage – what management terms an economic moat."

This sounds good to me and further: "WCM suggests to never bet against a growth company with a good corporate culture that has a competitive advantage that is growing.  It is not enough to invest in a company that has a huge competitive advantage, investors also need to look for companies that have a competitive advantage that is growing.  That is the differentiator – and a way to avoid the value trap."

Of course everyone would like to buy these kinds of companies as if they really do possess these qualities and trade on reasonable valuations then they're likely to comfortably outperform the benchmark. 

Finding these kind of great growth companies is easier said than done though, but let's take a look at three great global companies it has in the WCMQ Global Growth Fund (ASX: WCMQ).

Shopify Inc. (NASDAQ: SHOP) – is the cloud-based e-commerce or "checkout" platform that lets any small-to-medium sized businesses sell its products online. It is growing like nuts (total March quarter revenue +50% to US$320m) thanks to the unsurprisingly huge demand for its platform and looks on a pathway to profitability. I love this stock as much as WCM and I am not surprised to see it as one of the portfolio's largest holdings given WCM's investment philosophy.

Visa Inc. (NASDAQ: V) will be familiar to all Australians and looks to still have a huge growth opportunity as the world moves cashless. Importantly, card payments are also growing in volume thanks to the rise of contactless payments for everyday goods like coffee or lunch. Visa also has a wide moat thanks to the scale, capital, and tech required to deliver these services.

Mercado Libre (NASDAQ: MELI) is an e-commerce retailer similar to Amazon that is focused on the fast-growing markets of Central and South America. Mercado Libre is also growing at strong rates and appears to have a moat or competitive advantage via its network effect (most sellers and buyers) and scale. It is another highly regarded tech and growth business that has a fast-rising valuation.

For me it looks like the fund offers investors exposure to some great global growth names and although its investment track record is not very long it is already 9% ahead of its benchmark.

Therefore the fund could be worth some more research, starting with reading the Product Disclosure Statement and potentially taking professional investment advice for any interested investors. 

Tom Richardson owns shares in Amazon and Visa

You can find Tom on Twitter @tommyr345

The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon, MercadoLibre, Visa and Shopify. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

Businessman smiles with arms outstretched after receiving good news.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another strong showing from the share market today.

Read more »

Three miners looking at a tablet.
Resources Shares

Own ASX mining shares? Experts say an upswing in commodity prices has begun

HSBC economists Paul Bloxham and Jamie Culling explain why global commodity prices are rising.

Read more »

A woman with a sad face looks to be receiving bad news on her phone as she holds it in her hands and looks down at it.
Share Fallers

Why Brambles, Lifestyle Communities, Northern Star, and Select Harvests shares are sinking

These shares are having a tough session. But why?

Read more »

A young woman sits at her desk in deep contemplation with her hand to her chin while seriously considering information she is reading on her laptop
Share Market News

Will the Reserve Bank wait for the US Fed to cut interest rates first?

Here's when AMP thinks interest rates will be cut in the US, Australia, New Zealand, Canada and the Eurozone.

Read more »

A young woman holding her phone smiles broadly and looks excited, after receiving good news.
Share Gainers

Healthco Healthcare, Medadvisor, Ramsay Health Care, and Tamboran shares are rising

These shares are having a strong session. But why?

Read more »

drug capsule opening up to reveal dollar signs signifying rising asx share price
Share Gainers

If you invested $6,000 in Mesoblast shares a month ago you'd have $15,636 now!

Mesoblast shares have been on a tear this past month. But why?

Read more »

Gold bars on top of gold coins.
Gold

Is it too late to buy gold as an investment in 2024?

Can we still take advantage of gold at new record highs?

Read more »

A female broker in a red jacket whispers in the ear of a man who has a surprised look on his face as she explains which two ASX 200 shares should do well in today's volatile climate
Mergers & Acquisitions

Wesfarmers shares baulk on fresh acquisition gossip

A healthcare company gone nowhere in a decade might be on Wesfarmers' radar.

Read more »