Edmond de Rothschild Asset Management, the fund manager, has launched the Emerging Rendement mutual fund, to invest in the world’s fast-movi...

Edmond de Rothschild Asset Management, the fund manager, has launched the Emerging Rendement mutual fund, to invest in the world’s fast-moving emerging markets.

The risks formerly associated with emerging countries, such as hyperinflation, recurring political crises and so on, have abated significantly, said Edmond de Rothschild Asset Management.

The investment areas targeting by the fund include, Asia, Latin America, Eastern Europe, the Middle East and Africa. The fund promises a relatively low-risk approach by investing in stocks that are undervalued and pay out recurring dividends.

“Rising wages and low inflation are fostering the emergence of a middle class,” said Dominique Netter, chairman of the board of Edmond de Rothschild Asset Management, in a statement.

“Industrial expansion and infrastructure building is expected to sustain demand for raw materials for several years to come. Above all, these countries have implemented structural changes such as debt reduction and taming galloping inflation, creating a more stable economic and political environment for their businesses to operate.”

Emerging Rendement is a stock-picking fund comprising 60 to 80 stocks. Defensive stocks make up more than 50 per cent of the portfolio, while cyclical or financial stocks will never rise above that threshold.

Managers pay special attention to thematic, sector and geographical risk diversification, said Edmond de Rothschild. Priority will be given at all times to liquid stocks with a float exceeding $100 million.