Allianz Global Investors (AGI) is launching an agriculture fund in a bid to take advantage of the current soft commodity boom.
Available to UK investors from 1 April, the Luxembourg domiciled and UCITS compliant Allianz RCM Global Agricultural Trends fund will look to profit from the rapid biofuel advances and the rising affluence in the developing world.
RCM’s San Francisco-based manager, Bryan Agbabian, will run the fund, which will hold between 30 and 80 stocks.
AGI UK fund distribution head Nick Smith says with the world population set to rise to 9bn by 2050, the soft commodity boom looks set to continue.
“There are two big drivers in this sector," he says. "First is the rising affluence in the developing world, with increasing demand for better quality food, which is not just China, but India, parts of South America and the Middle East.
“There is also the biofuels; a lot of land which had crops to feed humans has been turned to corn and sugar plantations to create ethanol.”
Smith says the fund will look at global opportunities, with many ideas found in the “agricultural powerhouse” of the US.
“This is a specialty fund and one which can be held around a core portfolio," he says. "The trends driving agriculture are long-term and powerful.”
The fund has a 5% initial charge, 1.75% annual management charge and 3% commission. Minimum investment is €1000.
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