VAM Funds has launched a frontier markets equity fund.
The Luxembourg-domiciled VAM Frontiers Markets will target opportunities in the countries domiciled or doing business in the 33 countries classified by MSCI as frontier markets.
VAM partner Driehaus Capital Management is responsible for investment strategy under the leadership of Chad Cleaver, who runs the VAM Emerging Markets Growth fund.
Cleaver will invest across the market spectrum for his frontier funds, typically holding between 60 and 90 stocks.
'Over the years the emerging markets team at Driehaus has identified and invested in a growing number of compelling opportunities within frontier markets. These markets maintain remarkable demographics and strong future growth potential, Cleaver said.
'Many consumer-related industries are at early stages of development and increasing local demand – such as in banking services, retail merchandising, mobile penetration and auto sales – which is a significant driver of growth.
'At the same time, these markets have small market capitalisation-to-GDP ratios relative to developed and emerging markets, suggesting an undervalued opportunity set. Supporting the opportunity is the fact that foreign direct investment is increasing, which provides an additional significant driver of growth within the frontier universe.'
The fund, which has a 2.25% annual charge, will be available to institutional fund buyers, including discretionary fund managers, wealth managers, funds of funds, private banks and family offices.