Fund Management

Barings Taps Into New Market With Fund Launch

Ainhoa Barcelona Reporter London 25 April 2013

Barings Taps Into New Market With Fund Launch

After securing regulatory approval, Baring Asset Management, the London-headquartered investment house which is part of MassMutual Financial Group, has launched the Baring Frontier Markets Fund.

The fund holds over $21 million in assets under management, and seeks to achieve long-term capital growth through at least 70 per cent exposure to frontier markets in places such as Nigeria, Saudi Arabia and the United Arab Emirates.

Investment manager Michael Levy heads the fund, with the support of Dr Ghadir Abu Leil-Cooper, head of EMEA at Barings. They will use a combination of top-down analysis of the political and economic factors affecting each country and industry, together with a bottom-up stock selection process to seek strong investment returns in markets that fall outside developed or emerging market benchmarks, the firm said.

As reported by this publication, Levy has previously said: “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.  We believe these markets are widely mispriced and hold undiscovered investment opportunities.”

Speaking on the launch of the new vehicle, Levy added that frontier markets represent a compelling investment proposition for experienced investors who are aware of the risks associated with holding equities in these markets.

Barings likewise added that frontier markets offer the potential for strong long-term growth, in a low growth world, and that low correlation with both emerging and developed markets, as well as low intra-country correlation, means that such markets also offer diversification benefits.

The firm gave an approximate asset allocation by geography and delegated a majority, some 53.5 per cent, to the MENA region, followed by 23.5 per cent to Africa.

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