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RWC Partners to launch emerging market UCITs

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RWC’s Global Emerging Markets team is to launch the first UCITS version of the firm’s Emerging Markets equity strategy in November this year. 

The new long-only, circa 50-stock fund – RWC Global Emerging Markets Equity Fund – will be a sub-fund of  RWC’s UCITS range that now accounts for USD5.4 billion of the company’s total USD11.4 billion of assets under management.
 
Headed up by John Malloy and James Johnstone, RWC’s 15-strong Global Emerging Market team joined earlier this year from Everest Capital. The senior team members have worked together for 20 years and have been among the earliest investors in many markets. The team has seen significant support from institutional investors and is already managing over USD1.3 billion within their Emerging Market, Frontier and Asian strategies. This will be the first time that institutional investors will be able to access this team’s index-agnostic strategy in a UCITS-compliant format with daily liquidity.
 
Malloy’s strategy invests across both emerging and frontier markets, with a focus on companies exhibiting strong growth characteristics that are not yet reflected in the share price. A key attribute of the strategy is its focus on opportunities that are not yet broadly followed, whether in large markets like China, or in markets with few foreign participants such as Saudi Arabia or Bangladesh.  The growth drivers in a country or sector often follow established patterns seen in other markets previously. With their long shared history and index-agnostic approach, the investment team is uniquely placed to find these compelling opportunities ahead of the herd.
 
Dan Mannix (pictured), CEO of RWC Partners, says: “Inevitably the focus of this launch will be on the contrarian timing given the high levels of volatility seen in recent months.  In fact it should be seen as a long-term opportunity to invest in exciting companies with a market leading equity team.  The rate of growth of this team over the last two months exemplifies that there are a large number of investors who have the duration to look through these periods of volatility and have a need to have continuous exposure to the Global Emerging Markets. The team manages nearly USD1.3 billion assets out of RWC’s total AUM of USD11.4 billion.
 
“The UCITS space has been dominated in recent years by highly successful franchises of two or three Emerging Market teams. Given the difficulty of establishing fully formed GEM teams it has been incredibly hard for new entrants to compete. The massive increase in allocations to the asset class over the last 10 years has meant investors are looking further afield but the options remain limited.  RWC was able to take advantage of a highly unusual situation to bring John, James and their investment team over to RWC whilst maintaining their process, track record and having the support of a large number of their previous investors. It has allowed us to establish a fully formed, stable and proven GEM team in a short space of time. 
 
“To date the majority of investors in their strategies are US institutions. From the research we have done it is clear there is significant demand within Europe for the strategy. The team, approach and performance combine with a need for new ideas in the space to form a really compelling proposition.”
 
Malloy says: “It’s been a hectic and exciting few months for us. We’ve successfully moved the team to RWC and are extremely grateful for the investors who have chosen to support us. We then moved into one of those periods in EM where the world appears to be falling apart. The question is whether it is a long-term problem or something that has to be accepted as part of the journey of allocating to GEM.  Personally I’ve been investing in GEM for over 20 years and over that time you learn that these things happen but the key is to focus on the opportunity rather than the noise.”

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