View more on these topics

Alquity takes SRI to Africa

Emerging markets specialist Alquity Investment Management has established a Sicav investing in Africa within a socially responsible investment framework.

The fund launched in June for European and Asian investors, but a sterling share class has now been added. It invests mainly in African equities, but will have the flexibility to invest in fixed-income securities and money market instruments. It aims for absolute returns in the sense of not producing relative returns, where a fund will perform well if it loses less money than a benchmark index. The firm expects the portfolio to generate double digit returns on an annual basis but will not use leverage or short selling.

Alquity Investment Management was founded earlier this year. It believes emerging markets represent strong investment opportunities due to a range of factors such as rising domestic growth, improved finances which contrast with the finances of developed markets, natural resources. The firm also believes environmental, social and governance issues are important and can have a positive effect on fund performance. In this area it is guided by the international standards for business set out by the United Nations and works with risk management and corporate governance specialist Riskmetrics Group.

As well as profit for investors, the firm wants to ensure local communities in Africa benefit. It will donate at least 25 per cent of its annual management fee and performance fee to The One Foundation. This will be used to support humanitarian projects such as Microfinance projects, which enable disadvantaged people to start or improve small businesses to help themselves out of poverty, which should benefit the African economy.

Alquity says not all 53 countries in Africa are attractive but this should not affect investors’ views of the whole continent. It says Africa is rich in resources and is benefiting from China’s demand for commodities and from growing domestic demand for consumer goods.

Alquity will invest only in countries that are stable or are improving. Sectors will have attractive growth prospects and the companies will need to be well managed and trading at a reasonable valuation. Stock selection is driven by investment themes such as increasing consumer wealth leading to increased demand for banking services.  In this example, listed banks in the country would be assessed on a range of criteria, including valuation.

African markets may have high growth potential but are more volatile than developed markets. Alquity sees this as less of a problem for long-term investors and feels some investors may have reassessed their views of risk in emerging markets after the financial crisis showed that developed markets may be riskier than they seem. However, a new fund from a new manager in an area that is new to many investors could have niche appeal, even if there is a charitable element to it.


Daniels could receive up to £13m on retirement

Lloyds chief executive Eric Daniels could leave the state-backed bank with around £13m in salary, bonuses and shares when he retires in Autumn 2011. According to a report in the Daily Telegraph, the 59-year-old is on a £1.035m annual salary and can earn a maximum annual bonus of £2.33m. It says Daniels is also in […]

Ignis warns of autumn fall in economic shock

Markets will plunge in the autumn as investors realise that new government bailouts for the economy will fail to provide a boost, according to Ignis multi-manager Simon Mungall. In a severely bearish commentary, Mungall warns that markets are already “pricing in” a fresh bout of quantitative easing. This means that if another round of QE […]

Garry Hale

Up to the challenge after setback

Well, it is a journey and it looks like it is going to be a challenging one. Unfortunately, I failed my AF 4 investment planning exam in the April sitting. I was not alone, as I understand only about 45 per cent passed this exam. These are challenging exams. I can appreciate they have to […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm