Below is the Executive Summary from the paper. “In this white paper, Vitaly Veksler, Portfolio Manager and CEO of Beyond Borders Investment Strategies, LLC (BBIS), focuses on explaining two impact goals of the firm, Helping Countries Recover from Crises and Strengthening Stability and Security Around the World.
In the first part of this paper, Vitaly Veksler, explains how his personal observations and experiences of the devastating impact of the economic crisis on common citizens in post-Soviet Russia and other former Soviet republics after the fall of the Soviet Union influenced his decision to found BBIS.
In the second part, Vitaly analyzes some economic and political reasons for that crisis. He focuses on economic and political reforms that Mikhail Gorbachev, the last President of the USSR, and Boris Yeltsin, the first President of post-Soviet Russia, implemented in the 1980s and 1990s. While collectively they were able to move the country from socialism to capitalism, the transition was far from smooth. Russia experienced an economic crisis that was deeper and longer than the Great Depression in the United States. Vitaly also analyzes nationalism as a common response to economic hardships during economic crises around the world and in post-Soviet Russia.
In the third part, he describes BBIS’ positive economic, social, and political impacts of investing via the single-country equity ETFs of nations where stock markets trade at low valuations, mainly due to major crises. He defines BBIS’ triple bottom line and focuses on the second and third goals of this bottom line:
- Earning Competitive Returns for Clients: Earning competitive returns for clients over the market cycle due to the valuation mean-reversion.
- Helping Countries Recover from Crises: Helping countries’ stock markets stabilize, companies start expanding their operations and hiring people, and the countries’ citizens emerge from crises.
- Strengthening Stability and Security around the World: Strengthening stability and security by reducing militant nationalism that often impacts people within crisis-afflicted countries, and sometimes spills onto the international arena in the form of terrorism or war.
As he describes Goal 2 of BBIS’ triple bottom line, Helping Countries to Recover from Crises, Vitaly describes the “Top 10” features that allow BBIS to positively impact countries it invests in. He concludes the paper by describing Goal 3 of the framework, Strengthening Stability and Security around the World, using examples from Germany during the 1920s and 1930s, post-Soviet Russia during the 1990s, and Tunisia where the Arab Spring started in 2010.”
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