Everest Launches Frontier Markets Hedge Fund

Aug 6 2010 | 3:14am ET

Emerging markets hedge fund Everest Capital is opening its frontier markets strategy to outside investors with a new fund.

Everest told investors that the capacity of the newly-launched frontier markets fund is US$400 million, MarketWatch reports. The firm has been investing in frontier markets for two years, with about US$90 million of its US$2 billion in assets allocated to the strategy.

While emerging markets have suffered big losses over that period, Everest said its strategy has produced a 10% return.

“Our opportunistic investment approach has allowed the frontier-markets strategy to exploit regional turmoil, including the unravelling of the Nigerian banking system and the Pakistani downgrade from emerging market status," the firm wrote. "We were also able to foresee the effects of the Dubai debt restructuring on the Middle East frontier markets region, and more recently the spill-over effects of the European sovereign-debt crisis on European frontier markets.”

Everest added that 17 of the 20 fastest-growing economies in the world are frontier markets.

“We expect that the emergence of young consumers into middle-class economies across frontier markets will result in growth engines for years to come,” it said.

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