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William Nemerever

William Nemerever is an industry leader in the use of modern portfolio techniques. A Managing Director at Grantham, Mayo, Van Otterloo & Co. LLC (GMO), Mr. Nemerever co-heads GMOís $9 billion global fixed income group, which manages $3.0 billion in its long-only, emerging country debt strategy and over $600 million in its emerging country debt hedge fund. These funds are not for the faint of heart. GMOís long-only fund is invested in hard currency instruments of up to 35 emerging countries, usually in the form of bonds or bank loans. The fundís performance since its 1994 inception is nothing less than phenomenal. It has beaten all of its emerging-markets bond rivals, with 1, 5, and 10-year annualized returns of 17.91% (vs. 11.55% benchmark), 24.73% (14.60%), and 20.90% (13.27%). Needless to say, it is a Morningstar 5-star fund.

The fund is fairly unique to its group. Mr. Nemereverís team concentrates on instrument selection rather than country selection, using advanced analytical techniques to exploit inefficiencies in the pricing of sovereign credits. They make extensive use of credit default swaps to hedge default risk. They avoid making bets on duration, and instead keep duration in line with that of the benchmark J.P. Morgan Emerging Markets Bond index. They also avoid bets on currencies: More than 90% of the fundís assets are denominated in, or hedged into, U.S. dollars.

Mr. Nemerever joined GMO is 1993 after stints at Fidelity Management and Research Company and at State Street Bank. He is both a CFA and a Fellow of the Society of Actuaries. He is a past Director of the Fixed Income Management Society of Boston. Mr. Nemerever received his B.S. in mathematics from the University of Washington and an M.S. in Actuarial Science from Northeastern University.

 

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