Generali Investments Luxembourg & Aperture Investors announce launch of Aperture Investors SICAV – Emerging Debt Opportunities Fund
● The Sub-Fund managed by Aperture Investors – part of Generali Investments’ ecosystem of asset management firms – invests in emerging markets’ debt, an attractive investment opportunity leveraging on the solid GDP growth, lower public debt ratios and improving credit quality recorded by these regions.
● The investment team, led by Peter Marber, identifies risk-adjusted returns across more than 75 emerging market economies to build a portfolio of long duration fixed income. The strategy will rely on the team which has been managing the Aperture New World Opportunities strategy since 2019.
Milan – Generali Investments Luxembourg S.A. and Aperture Investors, part of Generali Investments’ ecosystem of asset management firms, announce the launch of Aperture Investors SICAV - Emerging Debt Opportunities Fund, a value-oriented fixed-income strategy investing in corporate, sovereign, and quasi-sovereign debt securities of selected emerging markets.
For the last three decades, the total return for emerging markets external debt has exceeded US Treasuries and US High Yield and the asset class is considered as an attractive investment opportunity, as these geographies record continuous GDP growth, lower public debt ratios compared to developed countries, and steadily improving credit quality.
The long duration strategy aims to seize the opportunities generated by the approaching end of the rate hike cycle and the normalization of the US yield curve, which has shifted dramatically over the past 18 months(1). Looking at the past, when US dollar yields have peaked, subsequent periods have proved very positive for emerging market returns: credit spreads often tighten, currencies appreciate and equity markets rally, and the new strategy intends to focus on these opportunities.
The investment approach is based on a rigorous quantitative framework that analyzes fundamental economic data from more than 75 emerging countries, representing the primary filter for more than 2000 bonds. The investments team then analyze for liquidity, credit rating, maturity, and sector to find potential opportunities both in the government and private sector segment. The Sub-Fund’s investment team is led by Peter Marber, Head of Emerging Markets at Aperture Investors with a consolidated track record through numerous investment cycles and is composed by investments professionals who have worked together for many years, managing the Aperture New World Opportunities strategy since its launch.
The new fund offers a different risk profile to the already existing New World Opportunities strategy. The latter carries a duration of only 2.5 years and BBB- blended Investment Grade credit rating, while the new strategy is slightly lower rated, averaging BB+, with nearly triple the duration. Over the last decade, longer duration benchmark has exhibited more than twice the volatility of the shorter duration one, but the longer duration strategy also has the potential for higher returns in certain market environments.
Tim Rainsford, CEO of Generali Investments Partners S.p.A. Società di gestione del risparmio, commented: “We are delighted to further strengthen Aperture Investors' investment solutions offering. In recent months, most of Aperture's strategies have matured a three-year track record and are now enriched by this new approach(2), leveraging on the team’s skills in emerging markets. Aperture Investors SICAV – Emerging Debt Opportunities Fund will seize the potential offered by these regions today, leveraging on the historical low correlation of emerging markets debt with other asset classes, thus providing potential diversification benefits and attractive returns”.
Aperture Investors SICAV - Emerging Debt Opportunities Fund features the JP Morgan Emerging Markets Bond Index Global Diversified as its official benchmark and is registered in Austria, France, Germany, Italy and Spain(3).
With about €504.9 billion in assets (as of December 31, 2022) and over 1,200 investment professionals, Generali Investments is an ecosystem of asset management firms operating in multiple countries, delivering a portfolio of specialist capabilities. Every firm in the ecosystem is supported by Generali and able to innovate and grow with autonomy, while developing sustainable and innovative solutions. Generali Investments is part of the Generali Asset & Wealth Management Business Unit which gathers the Group’s main companies operating in asset management and wealth management. Generali Investments is part of the Generali Group, which was established in 1831 in Trieste as Assicurazioni Generali Austro-Italiche and is one of the leaders in the insurance and asset management industries.
Aperture is reestablishing trust in the asset management industry by aligning client interests with its own. Its mission is outperformance. Aperture strategies charge fees comparable with passive ETFs in the same category, when performance is at or below stated benchmarks. When and only when returns are generated in excess of a strategy’s benchmark, Aperture charges a performance-linked fee. Aperture investment teams are also compensated primarily on outperformance rather than assets under management. Led by industry veteran Peter Kraus in partnership with Generali, one of the world’s largest insurers, Aperture’s mission is embedded in its fee and compensation structures, as well as in the ways it openly engages with the investing community online. To learn more about Aperture, its managers, and its innovative structure, visit www.apertureinvestors.com.
(1) There can be no assurance that the investment objective will be achieved or that there will be a return on capital.
(2) Past performance does not predict future returns.
(3) The Fund is actively managed. The objective of the Fund is to generate returns in excess of the JP Morgan Emerging Markets Bond Index Global Diversified (the "Benchmark") by investing, either directly or indirectly, in different financial asset classes with a focus on Emerging Markets. The Benchmark is used for the purpose of calculating the variable management fee ("VMF") payable to the Investment Manager