Focusing on the world’s smaller markets brings its challenges, but they offer rare and idiosyncratic opportunities says Emily Fletcher, manager of the BlackRock Frontiers Investment Trust plc (LON:BRFI).
Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.
The world’s small markets are difficult to analyse. Information is scarce, liquidity is lower, and they may have a range of political and economic idiosyncrasies. This complexity means they are often over-looked, but in our view, they are worth the extra effort.
We recognise that these markets come with obstacles. Data is often delayed and may be unreliable. In large, developed markets inflation data may be revealed with the lag of a month or two; in some markets, it may take longer. This lag can be a challenge when trying to analyse why a country’s currency is behaving as it does, or whether its current account deficit is improving.
