Inside Edge Capital's Todd Gordon talks factors driving global markets

Brian Sullivan (Anchor) 00:00.000

And all the major US equity indexes, they're set to close out 2025 with double digit gains. Still, your next guest says, "He is looking to add some global assets to his portfolio in 2026." Joining us now Todd Gordon, founder of InsideEdge Capital. A man, I know. I know, Todd.

Brian Sullivan (Anchor) 00:20.040

You love America. You love this country, but maybe there's better investing opportunities around the world, particularly south of here really far south of here.

Todd Gordon (Founder) 00:32.840

Quite quite south and much warmer, Brian. Happy New Years to you. Yeah, love this country. I am a patriot, but we must as a capitalist follow the follow the capital. So, yeah, there is a rotation happening overseas, um particularly in South America. So, the main drivers we're

Todd Gordon (Founder) 00:47.120

seeing uh valuation and rotation away from, again, expensive tech growth stocks. The commodity move is very big. There are major exporters. Uh they're not as impacted also by tariffs. So, there's a little bit of insulation there. I think the move on the Venezuela. Perhaps is the

Todd Gordon (Founder) 01:02.800

view that we're stabilizing the area a little bit. And then the political change in Argentina with the new president, Javier Millet. I hope I'm pronouncing that right. He's a populist, right-wing, libertarian, gave that market a lot of boost. So, there's factors that are driving

Todd Gordon (Founder) 01:16.720

the rotation there. There's some effects at work, as I mentioned, the commodities. So, um yeah, I think, is it a full-on rotation out? No. I think we're still in a secular-driven AI bull market, but let's increase the exposures we already have overseas and particularly in the

Todd Gordon (Founder) 01:32.040

south in the portfolios.

Brian Sullivan (Anchor) 01:33.520

Yeah, Mercado Libre MELI technically headquartered in Montevideo, Uruguay. I hope I pronounce that right, but Yes a lot of its business of course in the more in the more populous nations, the Brazils, the Argentinos of the world. Again, this is an an incredible story. Somebody

Brian Sullivan (Anchor) 01:51.120

would call it sort of the Amazon of Latin America, but again I I think I'm guessing Yeah Todd that you have to watch currency moves, right? Cuz the currency moves that you talked about Those could change everything, I think.

Todd Gordon (Founder) 02:04.240

They they certainly can and it's it's interesting. There's a lot of nuance stories going on within Latin America, but particularly let's just focus on the dollar. The dollar index which is a basket against six or seven international currencies has been in a decline. And if we've

Todd Gordon (Founder) 02:19.920

really if we break a little bit lower in the new year, that's a break of a of a trend line that goes back to 2011. So that could be additional dollar weakness despite the the Fed, you know, done with the rates move, um that would boost international holdings. Um, you know,

Todd Gordon (Founder) 02:36.960

Argentina currency is getting destroyed. Um, I know Colombia is up and I know uh Peru is actually off significantly, but yeah, I mean MEI is is like you said, it's Amazon, it's PayPal rolled into one. It's a It's You know, they have a big first mover advantage in the area. It's

Todd Gordon (Founder) 02:53.440

a digital online platform. It's Amazon, it's marketplace. They're doing it. Amazon did in 2010, right? They're doing legit six, they have credit, financial services, they're expanding margins, the growth, if you look at the gap EPS, when you convert it into dollars, Brian, like

Todd Gordon (Founder) 03:08.240

they're going 35, 40% every year expected over the next 3 years, so the growth is there. Stocks pulled back to 1,900, we increased our allocation, and if we can get a little bit of a push up, I might go to 3 or 4% in our portfolio.