luxembourg portfolio is investing mainly in dollar-denominated emerging market debt
Ashmore Investment Management has launched a Luxembourg Sicav fund investing in emerging market debt.
The portfolio buys into debt from sovereign issuers which is denominated in the currencies of G7 countries. In practice this means the majority of exposure is in dollars. The Ashmore Emerging Market Debt Fund has daily dealing in both dollars and euros and the initial size of the portfolio is e28m.
Ashmore uses a top approach to investing looking not only at a country's ability to repay its debt but also at political stability and the liquidity of individual markets. Its funds typically employ the Ashmore Portfolio Framework which splits assets into high yield, total return and special situations categories to try and produce highly diversified liquid portfolios with a range of risk/return characteristics.
Mark Coombs, managing director of Ashmore Investment Management, said: 'The fund is modeled on our existing Guernsey-domiciled Emerging Market Liquid Investment Portfolio, which has returned over 19% a year after fees since launch in 1992.
'The investment process is exactly the same, largely unchanged for 10 years, and the same team, focused around our investment committee, decides investment strategy for all our products.'
Among the strategies Ashmore uses to try and add value to its fixed interest portfolios are investing on a local currency basis and buying into special situations. On the Emerging Market Debt Fund there are no plans to uses such strategies initially.
Jerome Booth, head of research at Ashmore Investment Management, said: 'The emerging debt market is one of the few strongly performing asset classes in today's global environment.'
The minimum investment for the fund is $5,000 or e5,000. The management fee is 1.5% a year. The Ashmore Group has in excess of $4.2bn under management and administration, of which $2bn is under management in emerging market debt.
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