Scottish Widows Investment Partnership (Swip) has launched four funds into its Luxembourg Sicav, three with emerging market strategies and the fourth a UK equity 140/40 portfolio.
The emerging market funds are SWIP Latin American Fund, SWIP Emerging Markets Smaller Companies Fund and SWIP Emerging Markets Infrastructure Fund.
The Smaller Companies Fund is managed by Alastair Reynolds. It will only invest in businesses that fall within the MSCI Emerging Markets Small Cap Index, and which are classified as emerging markets by dint of not being part of the OECD’s developed nations list. Annual charges on this fund are 1.6% and 0.80%.
Emerging Markets Infrastructure, managed by Divya Mathur, will invest in companies operating in a wide range of sectors, including power and energy, construction, environmental services, materials, property development, resources, transport and logistics, among others.
Eligible countries for the Latin American Fund, managed by Jeff Casson, include Brazil, Argentina, Chile, Colombia, Mexico, Peru, Bolivia, Cuba, Venezuala, Paraguay, Suriname, Uruguay, Barbados, Ecuador and El Salvador.
Both it and the infrastructure fund have annual fees of 1.5% or 0.75%. The minimum investment in all four funds is £1,000.
The 140/40 fund is Swip UK Extension Fund, which is not yet open to investors. It will invest in equities and equity-linked derivatives. Long exposure will range from 100% to 140% and short from 0% to 40%.
It has retail and institutional shares classes in euros, sterling and US dollars, with an annual charge of 1.8% for the former and 0.9% the latter.
Kim Catechis, head of global emerging markets for SWIP, said: “We continue to find attractive investment opportunities in emerging market equities. Market volatility has continued to revert towards the long term mean for these markets and this is an environment which particularly rewards SWIP’s style; fundamental research driven fund management.
“Although the emerging market equity universe will continue to see some volatility in the near term, we believe two strong trends – growth in infrastructure investing and the rapid expansion of the middle class – offer attractive opportunities for long term investors in these markets.
"Government backed infrastructure expenditure is forecast to be circa $12 trillion over the next decade. This gives greater visibility of company cash flows and earnings. A rapidly expanding middle class also results in a rise in consumer spending in the region, benefiting companies targeting the domestic customer.”
