The London-based asset manager Henderson Global Investors has announced it will launch a UCITS IV fund with an emerging market currency strategy later this year.

The fund launch, scheduled for the third quarter of 2011, follows last year’s July launch of the UCITS IV Henderson Horizon Global Currency fund, and the Henderson Global Currency fund Cayman structure, which was launched in May 2009.

Henderson’s current emerging market currency strategy invests in a range of currencies from Asia, Latin America, Africa and Europe. The firm’s emerging market strategy returned 15.8 per cent in 2008, 16.7 per cent in 2009 and 8.3 per cent in 2010, at an average volatility of 12 per cent.

“We expect long-term global economic growth to be largely driven by growth in emerging markets. The emerging economies are already seeing upward pressure on interest rates as inflation takes hold. We expect emerging market interest rates to increase significantly as the central banks try to prevent their economies from overheating and we expect the emerging market currencies to appreciate accordingly,” said Bob Arends, head of currency at Henderson.

“Increasingly we see investors becoming more aware of the importance of currency as it enables investors to avoid illiquidity and credit risk while offering low correlation with traditional instruments such as bonds or equities. As a result of interest rate rises currencies will appreciate, though conversely emerging market debt will fall in value, so investors realise that emerging market currency can be an important alternative for emerging market debt,” added Mark Skinner, co-head of global distribution.

As at 31 December 2010 Henderson Global Investors held an estimated £78.1 billion, approximately $127.8 billion, in assets under management.