With information now ubiquitous, the primary source of market inefficiency is no longer informational but behavioral. The most durable edge is "time arbitrage"—exploiting the market's obsession with short-term results by focusing on a business's normalized potential over a two-to-four-year horizon.

While international markets have more volatility and lower trust, their biggest advantage is inefficiency. Many basic services are underdeveloped, creating enormous 'low-hanging fruit' opportunities. Providing a great, reliable service in a market where few things work well can create immense and durable value.

Active management is more viable in emerging markets than in the US. The largest EM ETF (EEM) has a high 0.72% expense ratio, the universe of stocks is twice as large as the US, and analyst coverage is sparse. This creates significant opportunities for skilled stock pickers to outperform passive strategies.

A powerful EM strategy involves identifying businesses with proven, powerful models from developed markets, like American Tower. Local EM investor bases may not be familiar with the model's potential, creating an opportunity to buy these companies at a displaced valuation before their predictable results drive multiple expansion.

Countries like Poland, which transitioned to capitalism relatively recently, are under-followed by global investors. This creates opportunities to find "boring compounder" stocks, such as supermarket chain Dino Polska, at attractive valuations. These businesses are often run by outsider CEOs and are insulated from global hype cycles like AI.

The easy money in large-cap Japanese activism is made. The next wave of opportunity is in smaller, sub-billion-dollar companies based outside Tokyo. These firms are slower to adopt corporate governance reforms, leaving them undervalued and ripe for engagement.

The belief that you must find an untapped, 'blue ocean' market is a fallacy. In a connected world, every opportunity is visible and becomes saturated quickly. Instead of looking for a secret angle, focus on self-awareness and superior execution within an existing market.

Rather than retreating from popular but crowded frontier market trades, bullish investors are expanding their search for alpha. They are moving further down the liquidity spectrum to find new, less-trafficked opportunities, signaling a deepening commitment to the asset class despite positioning concerns.

Sir John Templeton's success in 1960s Japan reveals a key pattern: the biggest opportunities lie where volatility and a lack of information deter mainstream investors. These factors create significant mispricings for those willing to do the necessary but difficult research, such as in today's micro-cap markets.