Description

Trigon Emerging Financials Fund invests in global listed emerging market equities. This is a sector based fund focusing on a limited number of carefully selected banks and other companies in the financial services sector. The fund may also invest its assets into developed markets provided that the companies have substantial business interest in emerging markets. The fund is suitable for long-term investors keen on diversifying their investments in emerging markets and obtaining higher return than in the developed markets.

The fund’s investment style is active stock-picking combined with a top-down macro view that identifies quality equities at attractive values. The investment team visits the countries and companies on a regular basis in order to get firsthand information on the growth opportunities of the target companies. An attractive company for Trigon is one with a competent and transparent management team, strong market position in its sector and most important, one that can be purchased at an attractive price level. The fund does not follow any particular index and the stock selection is made irrespective of any index’s geographical allocation or company contents.

The growing importance of the banking sector is a megatrend in many emerging markets. Higher than average GDP growth in economies of the emerging markets is driving substantial boost in consumption and investment, which in turn stimulates demand for financial services. This combined with the fact that consumer and corporate debt levels are low creates a compelling investment theme. Globalization and the shift of industrial production to the emerging markets are benefiting these countries.

The fund management searches for markets where the penetration of the banking services is low combined with higher than average wealth and population growth. In many emerging markets the savings ratio is very high as people were used to uncertainty in the past. When political and macroeconomic prospects get better and confidence rises, there is significant room for the banking industry to grow and the economies grow by increasing leverage.

To invest in banks is the easiest way to get an indirect exposure to the whole economy.