US - Emerging markets investment management specialist Charlemagne Capital has announced the launch of a Latin American equity fund just days after launching an equity fund in Turkey.
The new magna Latin American fund has been launched on the back of “political and economic stability, improving profitability and China’s burgeoning demand for commodity exports”, Charlemagne said.
The fund will use the same bottom-up stockpicking process as that used by other sub-funds in the Magna range by targeting mis-priced equity assets, the firm added.
In support of the launch, the firm has appointed Samir Patel of Pictet Asset Management and Stefan Herz, currently at Charlemagne Capital, to head up the Latin American team.
Patel commented: “Unlike other boom periods, the renewed economic strength in the region is not expected to be accompanied by a rapid influx of imports that puts it into a current account deficit.
“The region also has a healthy current account balance and foreign exchange rates are at realistic levels, while international reserves in many Latin American countries constitute a healthy buffer against public and private debts.”
Herz added: “Companies throughout the region have been cleaning up their balance sheets and this is improving profitability tremendously. Corporate governance is improving and the increasing investments planned in China will mean more demand for raw materials.
“All in all, Latin America’s corporate sector is looking better than it has done for a long time.”
The objective of the fund, which is benchmarked against the MSCI Emerging Markets Latin America Index, is capital growth.
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