Hidden Gems in Frontier - Our Latest Ideas from Asia, Africa and Beyond

May 2018
Oliver Bell , Portfolio Manager
Mark Lawrence , Investment Analyst
Iona Dent , Associate Analyst

Hidden Gems in Frontier - Our Latest Ideas from Africa, Asia and Beyond

Oliver Bell, Frontier Markets Portfolio Manager, was recently joined by four Frontier Market analysts to discuss their latest ideas from recent research trips.
 

Areas covered include:
 

  • What do Sri Lankan politics mean for our investment thesis?

  • How are we playing the strong consumer in Vietnam?

  • Where are we finding opportunities in late-cycle Romania?
     

The team also talked about Argentina, which has experienced heightened volatility since the webcast was filmed. Argentina typifies the investment case for frontier markets but the transition from poor economic policy to good long term reform policy is always difficult as politicians have to keep one eye on the ballot box whilst instituting near term socially harsh or costly reforms.
 

In the team’s discussion we alluded to some of the monetary policy challenges the country faces as it tries to bring down inflation and inflation expectations. Argentina has benefited from a weaker US Dollar, cheap global money and the chase for yield. But this environment is being challenged and earlier missteps by the Argentinian central bank (cutting interest rates and lifting inflation targets) have led to a credibility gap being punished by the markets.
 

The rapid ratcheting up of interest rates to 40%, among other measures, should stabilise the peso and enable the economy to continue on its disinflation trend, which we believe should be positive for the country’s longer term outlook.

 

Key Risks – The following risks are materially relevant to the strategy highlighted in this material:

Transactions in securities denominated in foreign currencies are subject to fluctuations in exchange rates which may affect the value of an investment. Returns can be more volatile than other, more developed, markets due to changes in market, political and economic conditions. Investments are less liquid than those which trade on more established markets.

IMPORTANT INFORMATION

This material is being furnished for general informational purposes only. The material does not constitute or undertake to give advice of any nature, including fiduciary investment advice, and prospective investors are recommended to seek independent legal, financial and tax advice before making any investment decision. T. Rowe Price group of companies including T. Rowe Price Associates, Inc. and/or its affiliates receive revenue from T. Rowe Price investment products and services. Past performance is not a reliable indicator of future performance. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested.

The material does not constitute a distribution, an offer, an invitation, a personal or general recommendation or solicitation to sell or buy any securities in any jurisdiction or to conduct any particular investment activity. The material has not been reviewed by any regulatory authority in any jurisdiction.

Information and opinions presented have been obtained or derived from sources believed to be reliable and current; however, we cannot guarantee the sources' accuracy or completeness. There is no guarantee that any forecasts made will come to pass. The views contained herein are as of the date noted on the material and are subject to change without notice; these views may differ from those of other T. Rowe Price group companies and/or associates. Under no circumstances should the material, in whole or in part, be copied or redistributed without consent from T. Rowe Price.

The material is not intended for use by persons in jurisdictions which prohibit or restrict the distribution of the material and in certain countries the material is provided upon specific request.  

It is not intended for distribution to retail investors in any jurisdiction.

RELATED FUND
SICAV
Class I USD
ISIN LU1079765662
Seeking to identify long-term market leaders in countries on the cusp of rapid development.
View More...
Fund Size
(USD)
$279.3m
FACTSHEET
PRICE POINT - IN BRIEF
PRICE POINT - IN BRIEF
Notes From The Road