Funds’ mixed response to changes in Egypt

Investors still have mixed reactions to Egypt’s economic climate, weeks after civilian protests led to the removal of Hosni Mubarak as the country’s president.

Fund Strategy previously reported on British fund groups that had made large investments in Egypt before the revolts. Two days after the country voted on amendments to its constitution, few groups seemed any more convinced about its immediate prospects.

The Barings Middle East and North Africa (Mena) fund had a comparatively large exposure to Egypt at the end of February, albeit 1.3 percentage points smaller than the 21.7% December figure. The fund’s overall size reportedly dropped by 6.4% during the month, in response to the “heightened political risk”. Previously, the top three holdings in the fund were Egyptian. The National Bank of Kuwait has replaced EFG Hermes Holding. (article continues below)

As of March 11, Schroder’s ISF Middle East fund held an underweight position in Egypt. The fund’s exposure stood at 7.8% compared with 8.7% at the end of 2010.

Investec’s Africa and Middle East fund increased exposure to Egypt from 14.4% at the end of December to 15.4% at the end of February. However, its 2% exposure to Bahrain, a nation beset by violence between its Saudi-backed government and protestors, has been removed, according to Trustnet.