Investment focus - July 2008
A new fund emerging
Continued...
How it fits in our range
The fund adds choice for those looking to invest in emerging markets. An excellent fund in its own right, it complements our other emerging markets fund, the Scottish Equitable UBS Global Emerging Markets fund. Both are bottom-up funds, meaning they start by selecting the companies (stocks) they’re going to invest in and then consider how the fund is positioned in terms of geographical and industrial asset allocation. Both keep the freedom to invest in BRIC and non-BRIC economies. But their different investment styles and selection criteria mean that there are few similarities between the actual holdings of the two funds. In such a vast sector, this is perhaps what you might expect.
So, both funds offer excellent opportunities in their own right and they could also be used together in an investor’s portfolio to further increase diversification within this sector.
Emerging markets funds typically experience higher short-term volatility than almost every other sector, so they should be seen as long-term investments and form part of a balanced portfolio. Cautious investors may not be willing to accept the greater risk of investing in this sector, particularly over shorter time periods.