Neptune Frontier Emerging Markets Fund
The Neptune Frontier Emerging Markets Fund provides exposure to the powerful long-term growth potential of the world’s frontier markets. The fund manager has the remit to invest across frontier markets globally, as well as in the less developed emerging markets, offering a diversified portfolio. The Fund draws on Neptune’s expertise in emerging markets investment and consists of a high conviction, global portfolio.

Fund Manager

Ewan joined Neptune in February 2006 as an Investment Analyst. In July 2010, he was appointed Head of Emerging Market Equities and Investment Director. Ewan previously worked as an Editor for Yale University Press, having graduated from Oxford University with first class honours in English. He is responsible for global metals and mining sector research and is a CFA charterholder.
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FUND LITERATURE
The value of an investment and any income from it can fall as well as rise and you may not get back the original amount invested. This Fund may invest more than 35% in government and public securities in a number of jurisdictions. All applications are made on the basis of the Key Investor Information Document, Supplementary Information Document, Prospectus, most recent annual or semi-annual report and the Application Form, which can be downloaded above. Please read these carefully prior to investing. If you are unsure about the suitability of an investment please consult an authorised financial adviser. Potential investors in emerging markets should be aware that investment in these markets can involve a higher degree of risk.
ManagerEwan Thompson
Launch date20/12/2012
Fund size£3.4m
IMA sectorSpecialist
BenchmarkMSCI Frontier Emerging Markets
 
11723
CUMULATIVE PERFORMANCE
 1 Year3 Year5 YearSince Launch
Fund (%)4.14N/AN/A10.80
Index (%)11.89N/AN/A18.64
IMA Sector Average (%)5.38N/AN/A5.08
Sector Ranking78/141N/AN/A47/134
Quartile Ranking3N/AN/A2
Data as at 30.06.2014. Source: Lipper, C Acc Share Class, GBP1
DISCRETE PERFORMANCE
 30/06/1330/06/1230/06/1130/06/1030/06/09
 30/06/1430/06/1330/06/1230/06/1130/06/10
Fund (%)4.14N/AN/AN/AN/A
Index (%)11.89N/AN/AN/AN/A
IMA Sector Average (%)5.38N/AN/AN/AN/A
Sector Ranking78/141N/AN/AN/AN/A
Quartile Ranking3N/AN/AN/AN/A
Data as at 30.06.2014. Source: Lipper, C Acc Share Class, GBP1
 
 
 
ManagerEwan Thompson
Launch date20/12/2012
Fund size£3.4m
IMA sectorSpecialist
BenchmarkMSCI Frontier Emerging Markets
 
During the first quarter of 2014, several factors weighed heavily on the minds of investors. The slowing of US growth gave rise to renewed concerns about the direction of US monetary policy, while a series of rate rises in emerging markets, along with currency scares in some frontier economies, rattled the bars. Against this backdrop, large East-West geopolitical tensions were exposed by the ongoing Ukrainian crisis. However, equity markets – although volatile – generally produced marginally positive returns in the quarter. The frontier markets (especially many of the smaller ones) performed best. The US and Europe closed broadly flat to up, while emerging markets recorded a slight loss.
The Neptune Frontier Emerging Markets Fund returned 0.96% in the quarter against the benchmark gain of 6.71%.* There are a number of reasons for the poor performance. First, as mentioned above, many of the smaller frontier markets, such as Bangladesh, Bulgaria, Jordan, Lebanon, Oman and Vietnam, realised strong gains for a variety of disparate reasons. Individually, these markets contribute very little to the benchmark and we do not have a large presence in many of them, but when they all move against us together, a loss relative to the benchmark can in some instances be recorded. This scenario is not a usual occurrence. The second reason for the poor performance was the currency scare in Nigeria, during which we held an overweight position in the country. Finally, our exposure in Latin America was angled towards Peru which impacted performance. However, in both Qatar and the UAE, markets in which strong gains were realised, we performed better than the benchmark.
During the quarter, we reduced our overweight position in Nigeria, worried about capital flows, and decided to increase our weighting in the Philippines, where the country’s current account balance provides a relative degree of safety. We also decided to switch our overweight in Peru to an overweight in Colombia, concerned that investors are now worried about Peru for liquidity reasons. The upcoming infrastructure awards in Colombia should also provide a number of catalysts for well-placed stocks. Fundamentally, we continue to hold a very positive outlook for frontier emerging markets.
 
*Performance data supplied by Lipper; A Accumulation share class performance, in sterling with net income reinvested and no initial charges. The performance of other share classes may differ. IMA sector averages and rankings may change at any time as a result of closure, movement between sectors or price amendments by competitor funds. Where references to specific securities are made, they are for illustrative purposes only and should not be regarded as recommendations to buy or sell these securities.
This Fund may be higher risk than other funds and past performance is not a guide for future performance. The value of an investment and any income from it can fall as well as rise as a result of market and currency fluctuations and you may not get back the original amount invested. Investing in emerging markets can involve a higher degree of risk. Less developed markets are generally less well regulated than the UK and do not have the strict standards of accounting and transparency present in developed markets. Some emerging markets may have relatively unstable governments, economies based on only a few industries and markets that trade only a limited number of securities. As a consequence, both the value of investments made and the ease of which the underlying securities can be bought and sold may be adversely affected. Exposure to a single market increases potential volatility. Retail clients, if necessary, should consult an investment adviser or authorised intermediary.
Some information and statistical data herein has been obtained from sources we believe to be reliable but in no way are warranted by us as to their accuracy or completeness. These are Neptune’s views and as such this update is deemed to be impartial research. Any forecasts on the page are indicative and are not guaranteed. We do not undertake to advise you as to any change of our views. This is not a solicitation or an offer to buy or sell. All information and advice is given in good faith but without any warranty.
SECTOR ALLOCATION (%) as at 31/05/2014
Financials48.7
 
Industrials18.0
 
Materials8.6
 
Cash7.3
 
Consumer Staples6.6
 
Telecommunication3.8
 
Consumer Discretionary3.2
 
Energy2.5
 
Utilities1.3
 
Source: Neptune
REGION ALLOCATION (%) as at 31/05/2014
Qatar14.1
 
Philippines12.5
 
Colombia11.7
 
United Arab Emirates11.6
 
Other11.6
 
Kuwait8.4
 
Cash7.3
 
Nigeria6.3
 
Peru6.2
 
US3.9
 
Kenya3.9
 
Sri Lanka2.5
 
Source: Neptune
 

The market commentaries found on this page relate to regions which this Fund may invest in. For quarterly commentary that relates directly to this Fund please click here.

 
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    How to Invest

    Neptune funds can be invested in directly by filling out an application form, which can be downloaded below. Our funds are also available across a number of fund supermarkets and life company platforms.

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    Contact your IFA

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    FUND LITERATURE

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