Overheard at SuperReturn Emerging Markets

Hear what experts had to say at SuperReturn Emerging Markets about some of the hottest industry topics

On the investing environment

“There is no place for investors to hide at the moment – no asset class is unaffected by the broader economic environment. Nothing is completely resilient. However, I believe that relative to other asset classes, private credit was quite robust in the first half of 2022, as are selective emerging markets. I see these as having been beneficiaries of the current situation so far and I expect more opportunities as a result.”

Aislinn Bakker, Portfolio Manager, Development Finance, Allianz Global Investors

“Hunting alpha looks difficult right now. There is such a high correlation between asset classes right now it’s hard to make a decision on how to diversify. Instead, I have to focus on whether our exposure levels in certain assets are too high for the investable universe as it stands today. This all goes back to the quality of the assets and managers. This is what drives alpha today, not diversification.”

Amal Enan, CIO, American University in Cairo Endowment

On private credit in EMs

“Private credit is now a go-to instrument for investors, especially in Central and Eastern Europe. It really proved itself to be resilient through COVID times and now, as we see rising inflation and interest rates, private credit can offer very attractive risk-adjusted returns. Most funds are floating rate and investors can choose from a range of strategies to suit their risk appetite.”

Richard Rudner, Investment Manager, European Investment Fund

“Vintage year matters a lot in emerging markets private equity, especially in free-floating currencies. We put equity into a business in 2014 when the Turkish lira was 2.2 to the dollar; it’s now nearly over 18. You just can’t rise over that wave, especially when you have a difficult, recalcitrant owner. Yet if we’d invested the same amount of capital in the same vintage year in private credit, we’d have made a return.”

Yaser Moustafa, CEO, NBK Capital Partners

On broadening LP horizons

“Up to now, it may be that we’ve seen LPs looking for fund managers that are familiar because of education, cultural factors or opportunities that look like private equity in Europe and the US. It’s a kind of similarity bias. But this means they might overlook the importance of local cultural knowledge and ways of innovating for the local market and they might be excluding some of the most important factors in investment decisions.” Alison Klein, Manager, Private Equity, FMO