TORONTO, April 27, 2016 /CNW/ - Excel Funds Management Inc. ("Excel Funds") successfully hosted its inaugural Emerging Markets Symposium, which had over 400 attendees at events in both Montreal and Toronto. The symposium offered sessions tailored to both retail and institutional investors, which were tied together at the end of each gathering with an interactive panel discussion, to give Canadian investors an "insider's view" on investing in the emerging markets.
"Excel Funds has a successful history of partnering with the best asset managers from around the globe," according to Bhim D. Asdhir, President and Chief Executive Officer of Excel Funds Management Inc. "We were happy to showcase the depth and expertise of our sub-adviser teams and the response has been overwhelmingly positive. We believe that the best way to access the emerging markets is through portfolio managers and analysts that are on the ground. All together our sub-advisers carry out thousands of onsite manager meetings each year, and this is how we maximize returns for our investors."
Symposium attendees had the opportunity to glean analysis and insights delivered by portfolio managers and chief investment officers from: China Asset Management Company Limited, the largest asset manager in China1; Itaú USA Asset Management Inc., the number 1 ranked, privately-owned fund manager in Brazil2; Birla Sun Life Asset Management Company Limited, the 4th largest asset management company in India3; and Amundi Asset Management, currently ranked as the top asset manager in Europe.4
Collectively these firms manage more than US$1.4 trillion in assets.
Full highlights of the event can be found at: https://www.excelfunds.com/symposium.
The Excel Funds Emerging Markets Symposium highlighted bright spots within the global investments universe, as these industry experts explored investment themes and provided compelling reasons for Canadians to consider emerging market stocks and bonds as a part of their core portfolio holdings, including:
- Sustainable economic expansion in China being driven by a shift to consumption
- The benefit of active management in Latin America to identify investment opportunities
- Generating alpha by targeting Indian companies that trade outside the major indexes
- Yield enhancement from emerging market credit
China: Transitioning to a "New Economy"
Richard Pan, Head of QFII Investments, Institutional Equities, with China Asset Management Company Limited, explained why he thinks better quality growth is more important to China going forward. "I don't think there will be a 'hard landing' in China," says Mr. Pan. "Over the long-term, we think a more moderate GDP growth rate, of around 6 percent, will be healthier and more sustainable, than the 10 percent GDP growth rate [which we have seen in the past]."
Mr. Pan also touched on what differentiates China Asset Management Company Limited from other asset managers, "We believe that a strict investment process that is definable, repeatable and reliable, can add value for investors," says Mr. Pan. "We combine a rigorous top-down bottom-up approach, driven by a large research team of over 100 analysts on the ground, who cover more than 80 percent of the market cap in China. Additionally, our analysts will visit companies more than 2000 times per year, this is our primary competitive advantage."
China Asset Management Company Limited is sub-adviser of the Excel China Fund. To learn more about this investment strategy, visit: https://www.excelfunds.com/index.php/excel-china-fund-series-a-overview.
Latin America: A Compelling Value Story
Latin America has offered investors some of the best returns so far in 2016. Scott Piper, Head of Latin American Equities, Itaú USA Asset Management Inc., discussed in detail, how Latin America differs from other emerging market regions. "I think that the path of development [in Latin America] has been different from that of Asia," notes Mr. Piper. "Latin America is building from a low investment base, and as a result one of the major growth drivers across the region will be infrastructure spending, particularly in Brazil, where it's more about investment growing faster than the economy. This is very different compared to Asia which is migrating from less investment to more consumption."
Mr. Piper also outlined the importance of active management in Latin America. "The reason [active management] is important for a regional-only fund like ourselves, is because a lot of these new growth companies exist in very fragmented sectors and as a result do not have index representation. So the companies that are going to double their market caps over the next five to seven years, in many cases are not even included in the index. You don't capture that growth opportunity in a passive fund or an index fund, you really only capture that opportunity with a local manager that has boots on the ground, that is able to identify those investment opportunities."
Itaú USA Asset Management Inc. is sub-adviser of the Excel Latin America Fund and Scott Piper is lead portfolio manager of the fund. To learn more about the Excel Latin America Fund, visit: https://www.excelfunds.com/index.php/excel-latin-america-fund-series-a-overview.
India: The Bright Spot in A Slowing Global Economy
Currently the fastest-growing major economy in the world, India is often lauded as a beacon in a world that is moderating. Mahesh Patil, Co-Chief Investment Officer, Birla Sun Life Asset Management Company Limited, broke down some of the factors that are helping to drive this rapid expansion in India. "India is ushering in a major era of reform, centered around consumption, which accounts for approximately 60 percent of GDP," notes Mr. Patil. "The 7th pay commission, which will be a payout to the central and state government employees, [is an example of a reform that] will drive demand for consumer items and boost GDP." Mr. Patil expects India's GDP to grow at around 7.5 percent over the next five years and says, "India can sustain a growth rate of 7 to 9 percent depending on the global environment, while keeping inflation under control."
Mr. Patil also spoke at length about the benefits of active management for Canadian investors saying, "The Indian market is very well diversified. Active management has been able to generate alpha over the long-term; and in fact top quartile funds, have produced an alpha of around 6 percent [versus the benchmark]. From our point of view, it is important to have on-the-ground research in order to identify companies at the early stage of their growth. A strong independent research team is the source of active alpha generation in the Indian markets."
Birla Sun Life Asset Management Company Limited is sub-adviser of the Excel India Fund, which is the largest and longest-running India-focused mutual fund in Canada and winner of a 2015 Lipper® Fund Award for Best Fund over three years, in the Geographic Equity category. To learn more about this investment strategy, visit: https://www.excelfunds.com/index.php/excel-india-fund-series-a-overview.
Emerging Market Bonds: An Attractive Alternative to Traditional Fixed-Income Investments
Attendees also received an in-depth look at emerging market fixed-income from Sergei Strigo, Head of Emerging Market Debt and Currency, with Amundi Asset Management. Mr. Strigo explained why Canadians should consider emerging market credit as part of their investment portfolios. "The main advantage of emerging market debt is that it is a yield enhancement strategy," Mr. Strigo pointed out. "If you look at the levels of global interest rates today, major central banks are cutting interest rates to negative zones, and in the U.S., the Federal Reserve is not hiking interest rates to the extent that investors thought they would, so fixed-income investors are left with very little yield that they can get on their traditional asset classes. Hence, they are forced to go into more alternative asset classes such as emerging market debt, which provides investors with a significant yield pickup of around 6 percent if not higher on their investment."
Sergei Strigo, is sub-adviser lead of the Excel High Income Fund. To learn more about investing in emerging market debt with Excel Funds, visit: https://www.excelfunds.com/index.php/excel-high-income-fund-series-a-overview.
Why the Future of Investing Belongs to Emerging Markets
Delivering a full recap of the symposium, Christine Tan, Chief Investment Officer with Excel Investment Counsel Inc., explained to attendees why Excel Funds remains bullish on emerging markets. "Our view is that emerging markets have and will continue to contribute to the majority of global growth," according to Ms. Tan. "Not only are emerging markets more self-sustaining as a result of higher consumption rates, but the landscape of many of these nations are undergoing phenomenal political, monetary and regulatory changes that are positioning them for even greater growth in the future. Lastly, there is a growing realisation from the investor community that emerging market economies can substantially impact global financial markets."
About Excel Funds Management Inc.
Founded in 1998, Excel Funds Management Inc. offers an award-winning suite of emerging market strategies, catering to a broad range of investor profiles and objectives. Leveraging a global network of over 500 portfolio managers and 200 research analysts, our team has firsthand knowledge of the markets in which they invest – providing us with a true competitive advantage over our peers.
Our investment philosophy is grounded in disciplined fundamental research and continuously seeks out new growth opportunities in the emerging markets and beyond. Our on-the-ground sub-advisers and proprietary asset allocation models contribute to the firm being recognized as "The Authority in Emerging Markets".
Excel India Fund, Series A was awarded a 2015 Lipper Fund Award in the Geographic Equity category for the 3-year ending July 31, 2015 out of a total of 12 funds. The Lipper Fund Awards, granted annually, are part of the Thomson Reuters Awards for Excellence awarded by Lipper, Inc. and highlight funds that have excelled in delivering consistently strong risk-adjusted performance relative to their peers. The Lipper Fund Awards are based on the Lipper Ratings for Consistent Return, which is a risk-adjusted performance measure calculated over 36, 60 and 120 month periods. The highest 20% of funds in each category are named Lipper Leaders for Consistent Return and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1. The highest Lipper Leader for Consistent Return in each category wins the Lipper Fund Award. Lipper Leader ratings change monthly. For more information, see www.lipperweb.com. Although Lipper makes reasonable efforts to ensure the accuracy and reliability of the data contained herein, the accuracy is not guaranteed by Lipper.
1 China Asset Management Company Limited, as at March 31, 2016, based on AUM.
2 Associação Brasileira das Entidades dos Mercados Financeiro e de Capitais (ANBIMA), October, 2015.
3 Birla Sun Life Asset Management Company Limited, as at March 31, 2016, based on AUM.
4 Amundi Asset Management, No.1 European asset manager based on AUM. IPE "Top 400 asset managers" published in June 2015 and based on AUM, as at December, 2014.
SOURCE Excel Funds Management Inc.
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