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
Please find a more detailed description of share classes here.
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: 26.10.2021)
NAV: EUR 196.96 (25.10.2021)
Rolling performance (25.10.2021)
|25.10.2020 - 25.10.2021||16.63%||20.33%|
|25.10.2019 - 25.10.2020||-20.09%||-9.22%|
|25.10.2018 - 25.10.2019||11.91%||12.22%|
|25.10.2017 - 25.10.2018||-3.88%||-6.26%|
Annualized performance (25.10.2021)
|Since Inception p.a.||3.76%||3.26%|
Cumulative performance (25.10.2021)
Facts & Key figures
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
|Investment Manager||Bellevue Asset Management AG|
|Custodian||RBC Investor Services, Luxembourg|
|Fund Administrator||RBC Investor Services, Luxembourg|
|Year end closing||30. Jun|
|NAV Calculation||Daily "Forward Pricing"|
|Cut of time||15:00 CET|
|Subscription Fee (max.)||5.00%|
|Total expense ratio (TER)||2.37% (30.09.2021)|
|Legal form||SICAV Luxembourg jurisdiction|
|SFDR category||Article 8|
Key data (30.09.2021, base currency EUR)
|No. of positions||55|
Top 10 positions
Breakdown by sector
Opportunities & Risks
- 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.
- 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.
Review / Outlook
The risk-off sentiment last month, driven by fears of tighter global financial conditions and a slower domestic activity in China (the world’s largest commodities importer), hit EM markets and affected African equities. On the COVID-19 front, vaccination is gathering pace across Africa in line with improving vaccine supply. South Africa fully vaccinated 15% of its population as of last month. In Egypt, the government gave a 2-month notice to all its civil servants (5% of the population) to receive their 2 doses while it plans to start vaccinating those under 18-year old before year-end. Total active cases across the region fell from a peak of 740000 last August to 460000, according to the John Hopkins university database.
The continued decrease in new COVID-19 cases led South African authorities to relax their lockdown measures. However, this decision is unlikely to have a positive impact on the economy due to the lasting effects of both the pandemic and the July social unrests on investor confidence and job creation. Citing these negative developments, the South African Reserve Bank revised its 2022 and 2023 GDP growth forecasts from 2.3% and 2.4% respectively to 1.7% and 1.8%. The stock Index fell 4.7% mom and the Rand lost 2.7% against the USD.
Nigeria appears to be missing out on the oil price rally as its August oil exports of 1.3 mbpd came well below its OPEC+ monthly quota of 1.6 mbpd because of operational issues at key oil fields and export terminals. The nation raised USD 4.0 bn in Eurobonds via a triple-tranche offering across maturities ranging from 7 to 30 years, priced between 6.1% and 8.3%. There was no major improvement in the USD availability locally despite a combined inflow of USD 7.3 bn from the Eurobond issuance and USD 3.3 bn received from the IMF in August. Reports suggest that the parallel market rate weakened to NGN 560/USD in late September vs. the official rate of NGN 413/USD. Equities added 2.6% mom, after a 3.5% gain in the last two days of the month.
In Kenya, higher fuel and food prices drove headline inflation to a post-pandemic high of 6.9% yoy in September. Although second-round effects could push near-term inflation beyond the upper end of its target range (2.5%-7.5%), the Central Bank retained its main policy rate at 7%. Equities fell 2.2% mom in a quiet month as buying appetite from local investors faded in the second part of September.
The latest parliamentary elections in Morocco saw the Islamist ruling party lose more than 90% of the seats it won during the 2016 elections. This outcome puts a new coalition of three liberal parties at the government helm and raises hopes of an acceleration in the domestic reform agenda. Indeed, the governing parties and the King share a common economic agenda, which bodes well for the implementation of structural reforms. A post-elections enthusiasm likely contributed to the stock Index adding 3.9% mom, with local investors deploying more cash to equities.
Egyptian investors sold-off the market at the start of the month after a government decree announced a 10% capital gain tax on the trading of stocks and treasury securities to be levied starting from January 2022. The fall in the EGX30 was exacerbated by the global risk-off sentiment leading to a 5.6% mom loss. For the second time this year, the country issued Eurobonds – with a total nominal value of USD 3 bn, maturities ranging from 6 to 30 years tranches and yields between 5.8% and 8.8%. On the structural reforms front, new legislation and regulatory changes in the digital payments space is triggering a strong wave of fintech investments. E-Finance, a state-owned fintech company is expected to list on the market in October, which should allow investors to benefit from that trend in the country.
We reduced our exposure to gold mining names in favor of the oil complex, including petrochemicals and oil distribution names in Saudi Arabia. In Egypt, the lack of valuation multiples expansion despite strong H1 earning releases remains a disappointment for investors. Corporate management teams are increasingly turning their attention to this issue by rolling more aggressive share buy-back plans. At Cleopatra Hospital, one of our core Egyptian holdings, management decided to use the growing cash pile to buy up to 10% of its share capital. While that money could easily and profitably be invested in the real economy, the equity market needs such support to cushion the high real yield imposed by the Central Bank.
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