The Silk Road Income Fund – Access the high yields of the frontier markets in Africa, the Middle East and Central Asia

The pioneering Silk Road Income Fund was launched in October 2009. It gives investors exposure to a range of frontier fixed income markets, previously inaccessible to mainstream European investors in the shape of a UCITS compliant fund. The ground-breaking Luxembourg SICAV was launched to compliment Silk Invest’s equity offerings, namely the African Lions and Arab Falcons funds. As its name implies, the geographic remit of the fund is Africa, the Middle East and the Central Asia, leveraging of Silk Invest’s position as a market leader in these geographies.

The fund was awarded the 2009 ‘golden bull’ prize for innovation at the ‘Finanzen Nacht’ ceremony in Munich. Hailed by the German press as the “Oscar of the financial world”, the award is sponsored by Euro, Germany’s leading finance publication. The gala evening was attended by over 500 delegates. The event is considered to be Germany’s foremost award ceremony.

Zin Bekkali, CEO of Silk Invest, said “we are proud to have been recognized in this way. We launched the fund so that our clients could capture the unrivalled risk-return profile that we see in these markets. To be called innovative is icing on the cake and is especially nice in view of all the effort we have put into structuring access to these markets.”

Silk Invest believes that the frontier fixed income markets are often mispriced and overlooked by the mainstream. Daniel Broby, the Chief Investment Officer of Silk Invest, notes that ”investment in frontier markets today is now feasible. Risk is mispriced and with appropriate diversification our portfolio managers have constructed a robust investment grade portfolio with substantial yield pick-up.”

Silk Invest’s Chairman, Dr Heinz Hockman, who has a long history of product innovation in the German market, further commented that “the Silk Road markets are under-represented in investor’s portfolios. This fund gives a new asset allocation tool to forward thinking strategists.”

John Bates, the lead portfolio manager of the fund observed that ‘the timing of this award is fitting as the re-pricing of risk in these markets is taking place right now. The frontiers are entering a phase of development, while the rest of the world continues to recover from the global financial crisis.”

In order to initiate the fund, a ground-breaking survey of fixed income securities across the target regions, covering over 4,100 bonds and $480bn in total debt volumes was undertaken. John Bates, believes that “this award is a fitting recognition of our efforts in the fixed income space - up until now the portfolio basket has been largely off-limits to investors due to a lack of visibility in international market circles, but this is changing fast as these markets evolve.”

The SILK ROAD INCOME FUND aims to manage 60-80 holdings across 25 countries. The target portfolio is to achieve annual returns of 10-15% with a duration of 3.4 years and an average rating of “BB+”. Such an approach to investing in these niche markets means that investors gain respectable returns from a wide pool of assets. Patrick Landi, co-Manager of the fund said “our investment team has a unique blend of experience and exceptional local knowledge, fund management know-how and credit analysis skills.” Silk Invest is able to draw on far-reaching expertise, being headquartered in London and having staff on the ground in UAE, South Africa, Morocco, Egypt and Cameroon. The Silk Invest team consists of highly experienced specialists from South Africa, Nigeria, Egypt, Pakistan, UK, Belgium, Netherlands, Ivory Coast, Cameroon, and Morocco.

With Daniel Broby’s longstanding investment management track record, John Bates’ experience as a credit analyst and Patrick Landi’s experience in origination, Silk Invest have put together a formidable team of people. All have hands-on experience in frontier markets and should make this innovative fund truly worth following.

 

END

 

 

For additional information contact Director of Business Development, Baldwin Berges (Baldwin.berges@silkinvest.com) or visit www.silkinvest.com 

 

 

Silk Invest, a London based and FSA regulated asset management firm

Baldwin Berges

Silk Invest Limited

4 Lombard Street - London EC3V 9HD - United Kingdom -

+44 7772 460768

www.silkinvest.com