Schroders has launched a new fund that invests in Brazilian equities expected to benefit from the country's domestic growth stories.
Carlos Scretas, the head of equities in Brazil and manager of the new Schroder ISF Brazilian Equity fund, combines top-down market analysis with bottom-up stockpicking.
Based in Sao Paolo, he aims to build a concentrated portfolio of between 20 and 40 quality value and growth stocks trading at attractive valuations.
Scretas says he currently finds compelling investment opportunities in sectors such as real estate, discretionary products and financial services. Brazil is also one of the world’s largest producers of commodities, including aluminium, coffee and soybeans.
Despite mounting inflation worries, Brazil’s central bank recently cut its benchmark interest rate by 50 basis points to 12%. The decision was prompted by fears over a global slow down and a weaker growth outlook for Latin America’s largest economy.
However, the rate cut bolstered investor sentiment towards Brazilian equities.
According to yesterday’s Bank of America Merrill Lynch Fund Manager Survey, Brazil is now the most favoured emerging market equity market. Global fund managers told Merrill Lynch they have further increased their overweight in Brazil over the past couple of weeks.
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