First State to soft close Latin American fund
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First State Investments will soft-close its recently launched Latin America fund when assets under management reach $200m (£137m).
The group announced the launch of the fund, which will sit under First State’s ICVC and be domiciled in Britain, last Monday.
It will be managed by Jonathan Asante, who also runs the Global Emerging Market Leaders fund, and Millar Mathieson, with Alan Nesbit acting as deputy manager.
Mathieson told Fund Strategy the group believes the vehicle will have reached full capacity at $200m and will be soft-closed. He adds it was approached by an existing client within the emerging market portfolio to create a fund focused on Latin America and the managers decided the investment case for the region over the next five to 10 years was attractive.
“There may have been times in the past where we have turned away [from this area] but the investment case at this time from a top-down and bottom-up view is good. Over the last few years hundreds of firms have come to the market giving us a greater universe of opportunities, which has been helped by the correction of the last 12 months.”
The fund will be launched in mid-April and will hold 20-60 stocks. There is likely to be a overlap with the stocks in the Global Emerging Market Leaders mandate.
Mathieson says companies that are likely to be featured include Natura Cosmeticos, All America Latina Logistica (ALL) and America Movil.
“Natura Cosmeticos is a consumer staple and our largest play on the cosmetic, fragrance and toiletry space. It has a leading market share, excellent track record and is transparent. It will probably be one of the top holdings.
“ALL transports freight using the rail roads. The management is well-incentivised and it has predictable growth. Also, America Movil is a stock we have admired and liked for a long time but have only recently bought on valuation grounds.”
The managers expect the fund to have a skew towards stocks in Brazil, Mexico and Chile but the fund is allowed to invest in neighbouring countries such as Colombia, Panama and Peru.
The fund will be seeded with £10m by existing clients and minimum investment is £1,500.
