Top French manager Marc Girault is launching an emerging market (EM) fund into the UK market, as he believes prices have bottomed-out in the turbulent sector.
‘Emerging markets have been underperforming developed markets for four years now and we think they are as low as they will get,’ said Girault, who runs asset management boutique HMG Finance. ‘So many investors are negative on emerging markets and there has been some selling of EM funds, which I think tells us we are getting close to the bottom of valuations.’
The Citywire A-rated manager has moved to London will launch the HMG Global Emerging Markets Equity fund next month with his brother Paul, as a sub fund of specialists Goodhart Partners LLP.
His existing €284.6 million Globetrotter fund has returned 159.7% over the past five years and is top decile-ranked in the Citywire Global Equities sector. The Luxembourg-domiciled fund will have a capacity of around $1 billion, with a minimum initial investment of $500,000.
The Globetrotter strategy invests in the emerging market subsidiaries of European companies, alongside some convertible bonds. The new fund will have no fixed income exposure but will broaden its equity exposure to include subsidiaries of all developed market countries.
It is a diversified, value driven strategy, with significant exposure to Brazil, but no direct exposure to China, because Girault does not think valuations in the region are cheap enough yet.