Latin Finance - July/August 2010 - 14

equity/debt fund performance

crossover investors for new issuance since late last year. The trend comes amid a greater overall interest in EM assets over the last two years, especially since developed markets have crumbled. “It’s good that a lot of new players are coming in, but I think that in a tricky market, the way you outperform and preserve capital is through experience,” says Carlson. He does not foresee a lack of fixed income buying opportunities, despite the tremendous flow into the asset class. “Many investors unfortunately tend to confuse GDP growth with opportunities in stocks, and it doesn’t work that way,” says Carrillo, who says most of the equity flows in the last five years have gone into Asia. “This might make more heads turn to China, though they should be looking at earnings growth.”

Better value beyond Brazil, says Kutas In sovereigns, investors scaled back high yield and higher beta like Venezuela and Argentina, with dedicated investors moving close to neutral after a peak overweight in December 2009. “If liquidity deteriorates further, there is a risk that dedicated EM and crossover investors could take profits in some of their higher-quality holdings,” says

Hoarding Cash

Despite all of the self-serving bullish talk from dedicated funds, a May survey by JPMorgan of fixed income clients finds that investors reduced risk but remain long the carry across external and local markets. It says cash balances rose by 0.7% to 4.4%, a level not seen since November.

JPMorgan. Nonetheless, the bank says investors remain constructive on the outlook for EM fixed income over a sixmonth time horizon, and expects the EMBIG to contract to 283 basis points. “Were not seeing appetite to add risk,” says Rogerio Oliveira, director of EM fixed-income research at Morgan Stanley, noting that he saw the first EM bond outflows of 2010 in early June. Oliveira did not expect to see large inflows in June or July. Morgan Stanley finds that as of early June, EM assets were about 70% of the way through a technically-induced correction. “Medium to long-term value has been built in to the market, but I still think that the next month or two we are in correction mode,” Oliveira says in early June. “We need to be comfortable that the exposure from the fund managers has gone at least to average or underweight, so we see grounds for a sustainable rally towards the end of the year,” Oliveira says. He is cautious, expecting further volatility to materialize as dedicated EM investors cut exposure, which remained high versus benchmarks such as the EMBI or MSCI.

Top Latin Equity Funds, Year to April 1
Outperfroming on the upswing Benchmark MSCI EM Latin America Brazil Bovespa Mexico Bolsa Manager JPMorgan Asset Management Invesco Perpetual Amundi Funds T Rowe Price BlackRock BGF International Opportunities Funds Handelsbanken Fidelity Funds TD
Source: Lipper

Launch

Size ($m)

Total 1 year 97.83 121.81 93.94

Total Annualized Returns (%) (%) Annualized Returns 3 Year 5 Year 12.82 20.74 1.11 9.83 10.37 16.31 12.43 12.52 11.80 NA 13.54 13.50 8.98 26.30 31.53 18.93 26.88 25.89 31.50 29.02 28.32 27.22 NA 26.99 27.46 25.80

Fund JF Latin America Equity Latin America Latin America Equities Latin America Fund Latin America Fund Latin American Fund Latin American Equity Latinamerikafond Latin America Fund Latin American Growth I 2000 1994 1994 1993 1991 1997 2008 1994 1994 1994 316.79 590.80 727.91 2,994.90 468.50 6,381.44 326.84 555.82 1,142.44 211.48 121.95 121.27 121.80 119.02 117.65 114.97 114.10 113.22 112.54 108.96

14 LatinFinance

July/August 2010



Latin Finance - July/August 2010

Table of Contents for the Digital Edition of Latin Finance - July/August 2010

Latin Finance - July/August 2010
Contents
Equity/Debt Fund Performance
European Investors
Brazil Domestic Buyside
Mexican Domestic Buyside
Mexico Venture Capital
CEMEX CFO Interview
Panama Investment
Canadian Miners
Peru Investor Report
Peru is Making Strides to Develop Gas and Oil
Microfinance Volume Rises at a Steady Clip
Latin Finance - July/August 2010 - Latin Finance - July/August 2010
Latin Finance - July/August 2010 - Cover2
Latin Finance - July/August 2010 - Contents
Latin Finance - July/August 2010 - 2
Latin Finance - July/August 2010 - 3
Latin Finance - July/August 2010 - 4
Latin Finance - July/August 2010 - 5
Latin Finance - July/August 2010 - 6
Latin Finance - July/August 2010 - 7
Latin Finance - July/August 2010 - 8
Latin Finance - July/August 2010 - 9
Latin Finance - July/August 2010 - Equity/Debt Fund Performance
Latin Finance - July/August 2010 - 11
Latin Finance - July/August 2010 - 12
Latin Finance - July/August 2010 - 13
Latin Finance - July/August 2010 - 14
Latin Finance - July/August 2010 - 15
Latin Finance - July/August 2010 - 16
Latin Finance - July/August 2010 - European Investors
Latin Finance - July/August 2010 - 18
Latin Finance - July/August 2010 - Brazil Domestic Buyside
Latin Finance - July/August 2010 - 20
Latin Finance - July/August 2010 - 21
Latin Finance - July/August 2010 - 22
Latin Finance - July/August 2010 - 23
Latin Finance - July/August 2010 - 24
Latin Finance - July/August 2010 - 25
Latin Finance - July/August 2010 - Mexican Domestic Buyside
Latin Finance - July/August 2010 - 27
Latin Finance - July/August 2010 - 28
Latin Finance - July/August 2010 - Mexico Venture Capital
Latin Finance - July/August 2010 - 30
Latin Finance - July/August 2010 - CEMEX CFO Interview
Latin Finance - July/August 2010 - 32
Latin Finance - July/August 2010 - 33
Latin Finance - July/August 2010 - Panama Investment
Latin Finance - July/August 2010 - 35
Latin Finance - July/August 2010 - 36
Latin Finance - July/August 2010 - 37
Latin Finance - July/August 2010 - 38
Latin Finance - July/August 2010 - Canadian Miners
Latin Finance - July/August 2010 - 40
Latin Finance - July/August 2010 - 41
Latin Finance - July/August 2010 - Peru Investor Report
Latin Finance - July/August 2010 - 43
Latin Finance - July/August 2010 - 44
Latin Finance - July/August 2010 - Peru is Making Strides to Develop Gas and Oil
Latin Finance - July/August 2010 - Microfinance Volume Rises at a Steady Clip
Latin Finance - July/August 2010 - 47
Latin Finance - July/August 2010 - 48
Latin Finance - July/August 2010 - Cover3
Latin Finance - July/August 2010 - Cover4
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