William Blair Investment Management (WBIM) today (24 February) unveiled its Emerging Markets Frontier Debt SICAV fund.
The new fund, which will be co-managed by portfolio managers Yvette Babb and Daniel Wood, under the leadership of Marcelo Assalin, head of emerging markets debt.
The fund will invest primarily in a combination of local currency and hard currency denominated government debt from frontier markets countries across Asia, Latin America, Eastern Europe, the Middle East, and Africa.
Frontier markets – a subset of emerging markets (EMs) – are typically smaller economies in an earlier stage of their development and expected to grow faster than emerging or developed economies. These economies, such as Kenya, Egypt, Sri Lanka, and the Dominican Republic, generally have lower overall market capitalisation than emerging or developed economies and often less liquidity.
These markets are also under-researched and less well-understood than larger economies, creating greater opportunities to uncover value for those with intricate knowledge of these geographies.
Daniel Wood, portfolio manager at William Blair Investment Management said: “As investors continue to add exposure to emerging markets, we are committed to remaining at the fore of providing solutions that grant access to the expanding and untapped universe of frontier markets.
“Local currency denominated frontier debt has traditionally been more challenging for investors to access – the Emerging Markets Frontier Debt strategy will allow our clients to add diversification and gain exposure to these assets with the selectivity, risk controls, and expertise we have established through years of experience in investing in emerging markets.”
Yvette Babb, portfolio manager at William Blair Investment Management said: “Frontier markets are characterised by greater market inefficiencies, driven by lower levels of research coverage and transparency, and generally higher yields, necessitated by a greater perceived risk premium. These factors together provide an attractive combination of high-yielding assets and ample opportunities to uncover value-creating opportunities through an active approach.”
Marcelo Assalin, partner, and head of the Emerging Markets Debt Team at William Blair Investment Management said: “Drawing on our team’s long track record of investment in emerging markets debt, providing clients specialist, actively managed access to frontier markets seemed a logical next step to meet growing demand. We have been investing in frontier markets assets as part of our flagship emerging markets debt strategy since its outset. As a result, this team is well positioned to create a dedicated and tailored frontier markets focused product.”
William Blair is a global boutique with expertise in investment banking, investment management, and private wealth management, operating in more than 20 offices worldwide.
