(Alliance News) - Genesis Emerging Markets Fund Ltd said Tuesday it outperformed its benchmark in the first half of its financial year, giving the fund an encouraging outlook for the rest of the year.
For the six months to the end of December, the investment firm's net asset value total return was 4.5%, compared to 3.1% return from the MSCI Emerging Markets Total Return index.
As at December 31, net asset value per share was 867.3 pence, up from 790.4p the same date the year before and from 844.2p at the end of June.
Genesis Emerging's share price at the end of December was 792p, reflecting an 8.7% discount to net asset value.
Shares in the investment firm were down 0.4% on the day Tuesday at 751.00 pence, having declined further since the period-end.
The fund said that its perfromance across its portfolio was mostly strong, with positive returns from South Korea with search engine Naver over an agreed merger between it and Yahoo Japan.
There was also South Africa, with hospital operator Mediclinic International giving a positive trading update and Brazil with returns from investment Bank BTG Pactual and software firm Totvs.
However holdings in Nigeria and Vietnam underperformed, largely due to lower values from Dangot Cement and Vinamilk, and Russian holdings suffered from an outperformance by state-owned energy firms.
"The outlook for 2020 and beyond is encouraging. Significant components of the portfolio continue to show compelling internal rates of return, which includes weightings in frontier markets and smaller capitalisation companies. Such companies have not been in favour for some considerable time and may now come to the fore," said Chair Helene Ploix.
"While the recent coronavirus outbreak in China has introduced heightened levels of volatility and uncertainty in markets, we remain optimistic on the longer-term outlook for Emerging Markets, for many of the reasons that were valid when the fund was launched fully thirty years ago. We expect continued growth from rising working age populations in emerging markets, and continuing convergence with higher income countries," Ploix added.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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