Somerset Capital Management has launched the MI Somerset Frontier Markets fund and will be actively managed and highly concentrated between 40 and 50 companies.
It seeks to deliver compelling risk-adjusted returns across the market cycle by investing in companies that operate primarily in frontier market countries, throughout Asia, Eastern Europe, the Middle East, Africa and Latin America.
George Birch Reynardson, who joined Somerset in 2007 and has specialised in frontier markets investing since 2010, is lead manager of the strategy. He will be supported by fellow fund manager, Mark Asquith, and senior analyst, Kumar Pandit, as well as the wider investment team at Somerset.
Reynardson commented: “When we look at frontier markets today, they remind us of emerging markets in the 1990s when we first started investing. The institutions in these markets are immature, the industries are underpenetrated and the businesses are under-covered and underappreciated. All this makes for an extremely compelling investment opportunity.
“Our approach is to construct a portfolio that has a blend of growth and value. On one hand, we are looking to buy the companies that are best positioned to benefit from the structural growth prospects that abound in frontiers. On the other, we are searching out some of the lesser-known, underappreciated stocks that are trading at steep discounts to their asset values.”
The fund is open for business and will be available in USD, GBP and EUR share classes. It is domiciled in Ireland and is open for investment twice a month.