SYZ & CO adopts new investment approach to emerging markets
The SYZ & CO Group has decided to adopt a more balanced investment approach to emerging markets.
The Oyster emerging opportunities fund will seek to beat a new index dubbed SYZ Emerging Markets and developed in-house by the SYZ fund research unit, rather than the MSCI Emerging Markets NR Net USD usually adopted as a reference.
This new index is equally weighted between the 21 countries that make up the MSCI EM index, with an adjustment for market liquidity. The index is rebalanced once a year or when an exceptional event occurs.
The investment strategy developed by the reserach team also limits to +/-2.5% the country allocation differences between the fund and the index and to 5% the ex ante tracking error compared with the SYZ Emerging Markets index.
This is in contrast to most of the emerging markets funds, which concentrate on stock markets with the largest capitalizations and leads to a concentration of geopolitical risk and an over-representation of certain countries.
The Oyster emerging opportunities will be managed by Acadian Asset Management LLC, a
Boston-based specialized manager.