HSBC Global Asset Management launches Middle East and North Africa (MENA) fund

Published: 9 October 2009

HSBC Global Asset Management this week launches the HSBC GIF Middle East and North Africa (MENA) fund. The fund was initially scheduled for launch in October 2008 but was postponed until now amid the extreme global market volatility at the end of 2008 and early 2009.

With a more secure outlook for the region, HSBC Global Asset Management considers now is a more suitable time to launch this fund. The fund is managed by Andrea Nannini and his team at Halbis, the active management specialist within HSBC Global Asset Management.

Nannini said: 'Despite the recent rebound, stock prices are still significantly below their pre-crisis levels and offer very compelling valuation levels. The fundamental outlook for the region is rapidly improving on the back of higher commodity prices, strong domestic demand and proactive government policy. Therefore, we consider now is an excellent entry point for long term investors.'

The HSBC MENA fund will form part of HSBC's flagship Global Investment Funds SICAV, domiciled in Luxembourg and available for sale in more than 35 countries. The fund will have UK distributor status.

Benchmarked against the MSCI Arabian ex-Saudi Arabia Total Return Index, the HSBC GIF MENA fund will invest in companies from this region with a market capitalisation of greater than USD50 million. Countries within this universe include United Arab Emirates, Oman, Kuwait, Bahrain, Egypt, Jordan, Qatar, Lebanon, Morocco, and Tunisia. The fund can hold up 10 per cent of its portfolio in Saudi Arabia.

The fund will typically hold around 50-60 stocks. When constructing the MENA portfolio, Nannini and team will apply a principally bottom up, valuation driven approach, choosing stocks that display strong and sustainable business models, good corporate governance and attractive valuations.

Nannini said: 'The MENA region is expected to benefit from continued rapid economic growth and increasing liberalisation of the financial markets. Many of these countries are positioned to benefit from a rebound in commodity prices, in particular those within the Gulf region. Additionally, ambitious infrastructure development programmes are underway within the region, which provides an exciting investment theme.'

He added that within many of these markets, the companies were still undiscovered and under researched, thereby offering the potential to find good valuation anomalies amid individual stocks.

Minimum investment for the retail share class is USD5,000 and institutional share class is USD1 million. The annual management fees are 1.5 per cent and 0.75 per cent for retail and institutional investors respectively.

Nannini's team also manages HSBC's successful New Frontiers fund, a specialist fund that currently has around 50 per cent exposure to the MENA region. The New Frontiers fund was launched on 4 February 2008. Year-to-date (to end August 2009) this fund has returned 37.77 per cent in USD terms, compared to the MSCI Frontier Markets index of 19.96 per cent (Source: MSCI Barra, performance up to 31 August 2009, total return, net dividend index performance).

HSBC Global Asset Management is among the world's largest managers of emerging markets assets, with USD69 billion assets under management in this asset class, as at end of June 2009.

Media enquiries to:

Jenne Mannion 44 0 20 7024 0444 or at e-mail Jenne.mannion@hsbc.com

Jane Crookbain 44 0 20 7024 0412 or at e-mail Jane.crookbain@hsbc.com

Notes to editors:

Photos available upon request

Any performance information contained in this document refers to the past and should not be seen as a guide to future returns. Investments in emerging markets are by their nature higher risk and potentially more volatile than those inherent in established markets.

The sub fund referred to is a sub-fund of the HSBC Global Investment Funds, a Luxembourg domiciled FUND. UK based investors in HSBC Global Investment Funds are advised that they may not be afforded some of the protections conveyed by the provisions of the Financial Services and Markets Act 2000. The securities representing interests in HSBC Global Investment Funds have not been and will not be registered under the US Securities Act of 1933 and will not be offered for sale or sold in the United States of America, its territories or possessions and all areas subject to its jurisdiction, or to United States Persons, except in a transaction which does not violate the Securities Law of the United States of America. All applications are made on the basis of the current HSBC Global Investment Funds Prospectus, simplified prospectus and most recent annual and semi-annual reports, which can be obtained upon request free of charge from HSBC Global Asset Management (UK) Limited, 8 Canada Square, Canary Wharf, London, E14 5HQ. UK, or the local distributors. Investors and potential investors should read and note the risk warnings in the prospectus.

HSBC Global Asset Management

HSBC Global Asset Management comprises four specialist investment businesses: Halbis, Sinopia, Multimanager and Liquidity. HSBC Global Asset Management acts as the global representative of its specialist investment businesses and manages assets totalling USD390.1 billion at the end of June 2009. As one of the world's leading emerging markets asset management businesses, through its network of offices in over 20 countries around the world, HSBC Global Asset Management has strong relationships with corporates, institutions and financial intermediaries of all sizes and types.

HSBC Global Asset Management is part of HSBC Global Banking and Markets, a division of HSBC Holdings plc.

For more information see www.assetmanagement.hsbc.com

Halbis

Halbis is an active investment manager focused on delivering sustainable value-added performance in selected areas of the global market. It specialises only in areas where it is or will be highly competitive, namely European equities, value-added fixed income, Asian and Emerging Markets equities, and some alternative strategies. Halbis manages assets of USD140.36 billion (as at end June 2009).

For further information please visit: www.halbis.com

HSBC Holdings plc

HSBC Holdings plc, the parent company of the HSBC Group, is headquartered in London. The Group serves customers worldwide from around 8,500 offices in 86 countries and territories in Europe, the Asia-Pacific region, the Americas, the Middle East and Africa. With assets of USD2,422 billion at 30 June 2009, HSBC is one of the world's largest banking and financial services organisations. HSBC is marketed worldwide as ‘the world's local bank'.

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