Global value-based asset management firm Ariel Investments has announced the launch of its Emerging Markets Value portfolios in Australia.
The Ariel Emerging Markets Value and Ariel Emerging Markets Value ex-China portfolios seek to provide Australian institutional investors with exposure to a concentrated portfolio of companies with long-term earnings power at attractive valuations.
Ariel said that its emerging markets investment team, which is led by chief investment officer of emerging markets value equities, Henry Mallari-D’Auria, aims to capitalise on short-term market inefficiencies to drive long-term returns.
Driven by in-depth fundamental and quantitative research, the firm explained that its strategies take advantage of inefficiencies in emerging markets, which offer opportunities to own undervalued companies.
Ariel Investments senior vice-president, institutional marketing, head of Asia Pacific & MENA, Ian Webber, said that the firm was excited to bring the portfolios to Australia.
“The launch of these portfolios will offer Australian institutions an opportunity to access the expertise of Ariel’s Emerging Markets Value Team, who have a proven ability to identify compelling opportunities to capitalise on valuation dislocations,” he said.
“This skill can only be gained after years of experience successfully investing in some of the globe’s most inefficient markets, and it’s a capability we’re proud to be able to offer to Australian institutions.”
According to Ariel, emerging markets are creating opportunities for long-term investors to realise meaningful returns.
As a result, the firm said that institutions around the world were considering a return to emerging market equities following a period of underexposure to the asset class.
“Given the current state of global markets, Ariel believes there are many strong reasons for investors to return to the fold, particularly in emerging markets value,” the firm said.
“Secular and cyclical sources are positively contributing to high earnings growth, while portfolio price-to-earnings ratios are more attractive today than they have been at any time during the investing careers of Ariel’s emerging markets value team.”
Ariel’s firm-wide assets under management totalled approximately $16.2 billion as of the end of last year, including $1.35 billion for its subsidiary Ariel Alternatives.