Laurium Capital launched the Laurium Africa USD Bond Prescient Fund in South Africa in December 2019 for clients looking for exposure to a pure fixed income Africa CIS fund to achieve competitive USD yields and diversify their portfolios. Due to the significant interest received from offshore investors and South African investors wishing to access the fund in foreign currency, Laurium has registered the Laurium Africa USD Bond Fund, an Irish regulated collective Investments scheme, pursuant to the UCITS Regulations. The Laurium Africa USD Bond Fund is denominated in USD and has received FSCA approval under Section 65 of CISCA. Reasons to invest in African Fixed Income:
The Fund invests primarily in USD and EUR denominated fixed income instruments (Eurobonds) issued by African sovereigns, excluding South Africa. A Eurobond is a USD denominated bond issued outside of the United States. There are over 20 African sovereigns issuing Eurobonds via the Euroclear markets in Europe.
The Fund aims to outperform the Standard Bank Africa Sovereign Eurobond (excl. South Africa) USD Total Return Index at lower levels of volatility over time.
Since 2006, the African sovereign eurobond market has grown significantly to over $150bn. It has generated USD annualised returns of 8.9% p.a. The African Eurobond market trades around $500mn a day. These USD denominated, sovereign-backed instruments are settled via the Euroclear markets in Europe, carry no local currency risks, nor operational indecencies.
The fund uses fundamental bottom-up research, with a valuation bias, to generate a concentrated portfolio with high conviction ideas with a focus on stock picking and risk mitigation. The Fund will be invested in a minimum of 75% in Eurobonds, typically with a higher weighting over time. It may also invest opportunistically in local currency sovereign and corporate fixed income securities up to a maximum of 25%.