Advance Emerging Capital Is In Russia for the Long Haul

Advance Emerging Capital Is in Russia for the Long Haul

Russian equities may be out of favor, but cheap valuations make them attractive on a long-term basis, says a U.K. fund manager.

Institutional Investor Magazine

November 19, 2013

By Robert Stowe England

Emerging-markets equities remain largely out of favor with investors, which is not surprising, given the 4.27 percent decline in the MSCI emerging-markets index this year, as of November 7. And within the EM world, few markets get as much love these days as Russia. For one value investor, however, that’s a buying signal.

“Russia is one of the, if not the most, hated markets within the emerging-markets space,” says Slim Feriani, chief executive officer and chief investment officer at Advance Emerging Capital, a $750 million London-based fund manager. “From a contrarian point of view, it is a good thing. It’s a good entry point because everyone else avoids it.” The fund has 12 percent of its assets in Russian equities, compared with the country’s roughly 6 percent weighting in the MSCI emerging-markets index, making Russia the fund’s highest-conviction country.

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Robert Stowe England is an author and financial journalist who has specialized in writing about financial institutions, financial markets, retirement income issues, and the financial impact of population aging.

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