Hostile political environments can cause trouble for companies. High quality businesses tend to be resilient over the long term, so it’s important to look through rough patches when possible – if not possible, you need to be very selective on what you hold. Over the past few months, political tension between China and South Korea has escalated over South Korea’s decision to deploy the US-made THAAD missile defense system following increasingly hostile threats from North Korea. This pressure from China has moved beyond words to economic sanctions through unofficial means, which is impacting trade with South Korea. For us, our exposure to this situation is through two Korean companies—AmorePacific and LGHH—with growth largely driven by the sales of high-end cosmetics to Chinese consumers. Over the long term we are confident in their prospects, particularly through their sales within China – however, in the near term, we anticipate a pullback in earnings and cash flow growth, which needs to be accounted for in valuations.