BB African Opportunities (Lux)

Africa – a still largely untouched continent with attractive growth potential

 Lower correlation to global markets, especially compared to other emerging markets

 Structural change, reforms, raw material reserves and infrastructure investments as primary growth drivers

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Investment Focus

ISIN-No. LU0433847240

The Fund invests primarily in listed companies operating out of the emerging markets of Africa. At present, these are mainly countries in Northern Africa and the Sub-Sahara. Experienced emerging market experts, some of whom are from the region itself, focus on profitable large and mid-cap companies that stand to benefit from the region's strong growth momentum.

Indexed performance (as at: 24.09.2021)

NAV: EUR 168.50 (23.09.2021)


Fonds (Brutto)
01 Jan 2010 - 01 Jan 2010
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Rolling performance (23.09.2021)

B-EURBenchmark
23.09.2020 - 23.09.20218.61%13.47%
23.09.2019 - 23.09.2020-22.27%-15.65%
23.09.2018 - 23.09.20198.42%10.67%
23.09.2017 - 23.09.20181.67%-0.67%

Annualized performance (23.09.2021)

B-EURBenchmark
1 year8.61%13.47%
3 years-2.90%1.93%
5 years-0.19%1.83%
Since Inception p.a.2.47%2.50%

Cumulative performance (23.09.2021)

B-EURBenchmark
1M-0.35%0.14%
YTD3.42%3.62%
1 year8.61%13.47%
3 years-8.46%5.92%
5 years-0.95%9.50%
Since Inception34.80%35.37%

Annual performance

B-EURBenchmark
2020-14.85%-6.52%
20198.48%15.82%
2018-11.34%-13.81%
201712.89%8.35%

Investment Focus

The Fund invests primarily in listed companies operating out of the emerging markets of Africa. These are mainly countries in Northern Africa and the Sub-Sahara that are benefiting from progressive structural change, economic reform, infrastructure investment and their bountiful natural resources. They also offer largely untapped investment potential. The Fund additionally invests in attractive opportunities in South Africa. Experienced emerging market experts, some of whom are from the region itself, focus on profitable large and mid-cap companies that stand to benefit from the region's strong growth momentum. Using a fundamental bottom-up and top-down approach the investment specialists screen out the most attractive companies and construct a portfolio containing 50 to 70 stocks, broadly diversified across the various countries and sectors.Show moreShow less

Investment suitability & Risk

Low risk

High risk

The Fund’s investment objective is to generate attractive and competitive long-term capital growth. It is particularly suited to investors with an investment horizon of at least 5 to 7 years who want to diversify their portfolio with investments in emerging market equities. The Fund is exposed to the risks typical of emerging market equity investments.

General Information

Investment ManagerBellevue Asset Management AG
CustodianRBC Investor Services, Luxembourg
Fund AdministratorRBC Investor Services, Luxembourg
AuditorPriceWaterhouseCoopers
Launch date30.06.2009
Year end closing30. Jun
NAV CalculationDaily "Forward Pricing"
Cut of time15:00 CET
Management Fee1.60%
Subscription Fee (max.)5.00%
ISIN numberLU0433847240
Valor number10264484
BloombergBBAFOBE LX
WKNA0RP3D
Total expense ratio (TER)2.43% (31.08.2021)

Legal Information

Legal formSICAV Luxembourg jurisdiction
SFDR categoryArticle 8

Key data (31.08.2021, base currency EUR)

Beta0.66
Volatility14.20
Tracking error10.36
Active share47.80
Correlation0.80
Share ratio-0.17
Information ratio-0.63
Jensen's alpha-5.28
No. of positions58

Top 10 positions

Label Vie
Sothema
Commercial Intl. Bank
Attijariwafa Bank
Safaricom
Marsa Maroc
Equity Group
Maroc Telecom
Firstrand
Credit Agricole Egypt
5.8%
4.5%
4.3%
4.2%
4.1%
3.9%
3.7%
3.3%
3.2%
3.1%

Market capitalization

0 - 1 bn
1 - 2 bn
2 - 5 bn
5 - 15 bn
> 20 bn
Others
21.5%
26.4%
9.1%
34.4%
6.2%
2.5%

Geographic breakdown

Morocco
South Africa
Egypt
Kenya
Burkina Faso
Mali
DR Congo
Zambia
Saudi Arabia
Rwanda
Ghana
Nigeria
Others
Cash
26.6%
21.1%
20.5%
8.7%
3.5%
3.0%
2.4%
2.1%
1.8%
1.7%
1.2%
0.6%
5.3%
1.5%

Breakdown by sector

Financials
Materials
Consumer Staples
Healthcare
Consumer Discretion.
Communication Services
Industrials
Utilities
Real Estate
Energy
Others
Cash
26.4%
16.2%
15.4%
9.5%
8.4%
7.4%
4.9%
2.3%
1.6%
1.6%
4.8%
1.5%

Currency

MAD
EGP
ZAR
CAD
KES
USD
NOK
GBP
SAR
EUR
25.3%
21.2%
19.9%
11.0%
8.7%
5.0%
2.8%
2.4%
2.3%
1.5%

Opportunities

  • Africa – a still largely untouched continent with attractive growth potential.
  • Structural change, reforms, raw material reserves and infrastructure investments as primary growth drivers.
  • Local experts - emerging market specialists, including from the region, with a competitive track record.
  • Active fund management that is not based on a benchmark index, but on an in-depth analysis of individual companies.
  • Low correlation, in particular to the equity markets of other emerging countries.

Risks

  • Equities are subject to price fluctuations and so are also exposed to the risk of price losses.
  • The fund may invest in financial instruments that might have a relatively low level of liquidity, which can in turn affect the fund’s liquidity.
  • Investments in foreign currencies are subject to currency risks.
  • Investing in emerging markets entails the additional risk of political and social instability.
  • The fund may engage in derivatives transactions. The increased opportunities gained come with an increased risk of losses.

Of the USD 650 bn Special Drawing Rights (SDRs) the IMF disbursed last month, USD 275 bn went to developing nations: USD 33 bn to Africa vs. a combined USD 36 bn to Russia, India, Brazil and USD 42 bn to China alone. While these new rights are a timely relief for some African countries not attracting sufficient USD inflows to bridge their FX needs, they do not come with the structural reforms needed to drive a stronger post-pandemic economic rebound across the region. Total active COVID-19 cases rose to 740000 in August from 660000 in July, according to the John Hopkins university database.

A rebasing exercise from the national statistics office lifted South Africa’s 2020 nominal GDP to USD 335 bn, 11% above its last estimated level. This revision mechanically improves the country’s fiscal and debt metrics without changing their deteriorating trajectory nor the need to put public finances on a stable footing. The latter goal remains key for Godongwana, the newly-appointed Finance Minister, who still has to strike a tough balance between additional fiscal support and the containment of SA’s debt, at 71% of GDP last March. A clear reminder of local economic woes came from the unemployment rate that hit a new record high of 34.4% last June, which confirms the role social and purchasing power problems played in the civil unrests last July. Equities fell 2.2% mom on a double-digit drop in the Index heavyweights Naspers and Richemont. The Rand ended the month steady vs. the USD after losing up to 4.7% mom in mid-August.

Nigeria’s economy grew by 5.0% yoy in 2Q 2021 after adding 0.5% in 1Q 2021, a pale recovery driven by a low comparable basis (2Q 2020 was down 6.1% yoy). Indeed, the oil sector was in contractionary territory whereas growth in the construction, manufacturing and agricultural sectors was weak. With 90% of its NGN 2.2 tn fiscal revenue going into debt servicing in the first six months of the year, Nigeria has no space to push for fiscal stimulus. Structurally high inflation and unemployment rates, an infrastructure deficit and an FX shortage are some of the other chronic issues that should be addressed to improve domestic growth prospects. The IMF’s USD 3.3 bn SDRs (10% of FX reserves) and the USD 3.0 bn to 6.0 bn Eurobonds earmarked for next October are expected to alleviate the USD scarcity whilst driving a convergence between the official and black market FX rates. However, the Central Bank gave no hint at any change from its “managed-float” regime. The stock Index added 1.7% mom.

In Kenya, the banks’ 1H publications confirmed the stabilization of non-performing loans in 2Q 2021 and management teams were generally bullish on 2H 2021 and beyond. They guided for a continued improvement in their loan risk metrics along with an acceleration in loan growth to the high teens vs. mid-to-high single digits in 1H 21. Equities were up 6.0% mom before ending the month up 2.7% on increased foreign selling toward the end of August.

Preliminary figures put Egypt’s GDP growth for the fiscal year ending in June 2021 at 3.0% yoy vs. 3.6% yoy the prior year, showing the resilience of the economy in the face of the pandemic. Tier-one banks reported a strong earnings rebound yoy in 2Q 2021 on a post-COVID-19 normalization of loan impairments while the main real estate names booked record pre-sales numbers over the same period. The picture was more mixed in the consumer space as the impact of higher raw material costs and a lag in consumption recovery weight on net profit growth. The Central Bank kept its main operation rate at 8.75% for a sixth consecutive meeting, above the July headline inflation of 5.5% yoy. The EGX30 added 3.7% last month.

In Morocco, the authorities tightened their curfew measures and restricted movements between economic hubs to curb the recent surge in COVID-19 cases. The vaccination campaign continued with 40% of the population now fully vaccinated. Equities gained 3.2% mom.

Although last month’s 11.5% rebound in our Egyptian bank holdings is encouraging, their current valuation is far from reflecting their fundamental value: 2 out of 3 names still trade 32% below their pre COVID-19 levels whilst 2Q 2021 earnings are on average 7% above their 2Q 2019 results achieved before the outbreak of the global health crisis. We kept our core Egyptian positions steady in August and reshuffled our South African exposure to raise some cash to be deployed in Saudi Arabia offering a more attractive risk adjusted return in our view.

Past performance is not a reliable indicator of future results and can be misleading. As the sub-fund is denominated in a currency that may differ than an investor’s base currency, changes in the rate of exchange may have an adverse effect on prices and incomes. Performance is shown net of fees and expenses for the relevant share class over the reference period. All performance figures reflect the reinvestment of dividends and do not take into account the commissions and costs incurred on the issue and redemption of shares, if any. Individual costs are not taken into account and would have a negative impact on the performance. With an investment amount of EUR 1,000 over an investment period of five years, the investment result in the first year would be reduced by the front-end load of up to EUR 50 (5%) as well as by additional individual custody charges. In subsequent years, the investment result would also be reduced by the individual custody account costs incurred. The reference benchmark of this class is used for performance comparison purposes only (dividend reinvested). No benchmark is directly identical to a sub-fund, thus the performance of a benchmark is not a reliable indicator of future performance of the sub-fund it is compared to. There can be no assurance that a return will be achieved or that a substantial loss of capital will not be incurred. All figures in base currency in %, calculated by the total return / BVI method.Show moreShow less

  • Lead Portfolio Manager

    Malek Bou-Diab

    Malek Bou-Diab joined Bellevue Asset Management in June 2009 as portfolio manager new markets. He is lead portfolio manager for the BB African Opportunities Fund. Prior to that, he worked as investment specialist at Julius Baer, where he was responsible for managing an African equity fund. From 2003 to 2007 he worked as a quantitative risk analyst at Deutsche Bank AG in London. Between 1999 and 2003 he prepared his PhD thesis in theoretical physics at the Swiss Federal Institute of Technology Zurich (ETH). He spent a large part of his youth in the Middle East, where he received an international education and studied Arabic.
  • Portfolio Manager

    Andy Gboka

    Andy Gboka joined Bellevue Asset Management as Analyst / Portfolio Manager of the BB African Opportunities Fund in January 2015. From 2011 to 2014 he was Senior Analyst at Exotix LLP covering the brewers and cement companies listed in Africa. He previously worked for Societe Generale Corporate and Investment Banking as Equity Analyst in the European utilities team covering the regulated sector. He holds a Msc specialised in Finance, Bordeaux Business School, now Kedge Business School since the merger with Euromed Marseille in July 2013.
  • Product Specialst

    Jean-Pierre Gerber

    Jean-Pierre Gerber joined Bellevue Asset Management early 2009 as a product specialist. Prior to this he had spent 10 years with Julius Baer, where he assumed various responsibilities including head of fund research and senior product specialist equities / emerging markets. He is Board Member of the Swiss African Business Circle which supports companies with their business engagements in Africa. Before, he worked as an assistant auditor and consultant at Ernst & Young. Jean-Pierre Gerber has a master's degree in business administration and economics after studies at the universities of Berne and Warwick, UK.
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