Fund manager David Herro, who has produced an excellent track record over the past decade or so, says he actually welcomes the recent geo-political turmoil from an investment point of view.

“Commodity prices, political instability, monetary problems are certainly out there — they always have been out there, and in fact, they always will be out there,” Herro says in an interview with Fortune. “That’s the negative. The positive is that global GDP is growing at roughly 4.5% to 5% a year. That’s not a bad place for companies to exist in. We think most of these macro phenomena are cyclical or short term in nature and not structural. So actually I like it. The more instability and volatility, the better. It provides for more long-term investment opportunity.”

The contrarian-minded Herro is currently high on a market that has been unloved for some time: Japan. He says Japanese firms’ collective price-to-book ratio has gone from four or five to below one over the past couple decades, and adds that the firms’ return on equity is starting to creep up.

“Low price does not mean undervalued in our view,” Herro says. “You have to look for companies that (a) are selling cheap but (b) are committed to value creation, to doing something with their excess cash, to building book value per share, and to getting a good return on equity. And we’re able to find that [in Japan] for the first time ever — at least since the mid-1980s, when I started investing.”

Herro also discusses why he prefers stocks in countries like South Korea and Mexico over red-hot China, what he thinks are the biggest dangers going forward, and why he thinks energy and natural resources are the worst places for investors to be right now.