SWIP launches new emerging market funds

Scottish Widows Investment Partnership (SWIP) has launched three new emerging market funds which will invest in the top stock picks of its experienced Global Emerging Markets team, driven by in-depth fundamental proprietary research.

The funds, all sub-funds of the SWIP SICAV domiciled in Luxembourg, will offer investors a chance to gain exposure to the rapid growth opportunities that SWIP has identified in emerging markets.

The SWIP SICAV Emerging Markets Infrastructure fund, managed by Divya Mathur, Investment Director, will invest in companies which will benefit from the resulting rise in infrastructure spend in developing nations.

The SWIP SICAV Emerging Markets Smaller Companies fund, managed by Alastair Reynolds, Investment Director, will give investors an opportunity to diversify away from large companies, dependant on global trade, towards fast growing domestic economies. This fund will also capitalise on the opportunities that infrastructure and the growing consumer class represent in the region.

The SWIP SICAV Latin American fund, managed by Jeff Casson, Investment Director and manager of the top performing Scottish Widows Latin American fund, will benefit from excellent fundamentals in the region, including low debt and a robust financial sector, particularly in Brazil. A growing consumer base and a host of infrastructure developments underpin some very strong long-term opportunities for this fund.

This brings the number of emerging market funds in the SWIP SICAV to four following the launch of the SWIP Emerging Markets fund in 2007. The three new funds are currently available to investors in Luxembourg, Norway, Switzerland, Germany, Spain and the UK. SWIP is also in the process of registering the funds in additional countries across Europe.

Kim Catechis, Head of Global Emerging Markets at SWIP comments: "We continue to find attractive investment opportunities in emerging market equities. Market volatility has continued to revert towards the long term mean for these markets and this is an environment which particularly rewards SWIP's style; fundamental research driven fund management.

"Although the emerging market equity universe will continue to see some volatility in the near term, we believe two strong trends - growth in infrastructure investing and the rapid expansion of the middle class - offer attractive opportunities for long term investors in these markets. Government backed infrastructure expenditure is forecast to be circa $12 trillion over the next decade. This gives greater visibility of company cash flows and earnings. A rapidly expanding middle class also results in a rise in consumer spending in the region, benefiting companies targeting the domestic customer."

All three funds seek long term capital appreciation via focused portfolios of 35-45 holdings exposed to SWIP's best ideas. The funds are all based on the same proprietary research principle; to identify emerging market companies with sustainable strong earnings growth rates that are trading below their intrinsic value.

SWIP has been running infrastructure and emerging market small cap strategies for over three years and has a proven track record in Latin American equities; The Scottish Widows Latin American fund has achieved first and second quartile performance over the last three years to the end of June 2009.