Barings to launch frontier markets fund
Dubai, April 8, 2013
Baring Asset Management (Barings), a global investment management firm with offices, clients and business lines spanning the world's major markets, has announced plans to launch a new fund for frontier markets.
The Baring Frontier Markets Fund will target growth in markets that fall outside developed or emerging market benchmarks – such as Saudi Arabia and the UAE besides Nigeria, Sri Lanka and the Ukraine.
To be managed by Michael Levy, the investment manager, and supported by Dr Ghadir Abu Leil-Cooper, the head of EMEA at Barings, the neqw fund will seek to achieve long-term capital growth through at least 70 per cent exposure to Frontier markets.
The managers will use a combination of top-down analysis of the political and economic factors affecting each country and industry, together with a disciplined, bottom-up stock selection process to seek strong investment returns in markets that fall outside developed or emerging market benchmarks.
“Over the last 20 years, the free float market capitalisation of core emerging markets (MSCI Emerging Markets) has increased 25 fold and we believe that frontier markets are now positioned where emerging markets were 20 years ago, poised to become the next big opportunity in the coming years," said Levy.
Barings, he stated, believes frontier markets offer the potential for strong long-term growth, in a low growth world. Low correlation with both emerging and developed markets, as well as low intra-country correlation, means that frontier markets also offer diversification benefits.
"These markets are widely mispriced and hold undiscovered investment opportunities," he added.-TradeArabia News Service