The Franklin MENA Fund will invest in markets including Saudi Arabia, United Arab Emirates, Kuwait, Qatar, Bahrain, Oman, Egypt, Jordan and Morocco. The fund is not expected to allocate more than 40 percent of assets to a single country in the region.
San Mateo, California-based Franklin, which operates as Franklin Templeton, said the fund will be managed by Stephen Dover but sub-advised by Algebra Capital Ltd, a Dubai-based fund manager in which Franklin acquired a 25 percent stake last August.
Algebra Chief Executive Ziad Makkawi said in a statement that while high energy prices have boosted growth in the region, its economies were diversifying and it was also supported by a young population.
"The MENA region represents one of the great frontier market investment opportunities, offering the potential for long-term growth and low correlations with other markets," the statement said.
The fund is being rolled out to investors in Hong Kong, the Middle East and UK.
Rival fund houses Fidelity and Schroders (SDR.L: Quote, Profile, Research, Stock Buzz) launched similar Middle East- and Africa-focused funds in Hong Kong last August, making the case that even for a region rich in emerging market opportunities, Asian investors would benefit from the diversification.
Franklin is one of the largest publicly traded U.S. mutual fund managers with more than $623 billion in assets under management at the end of May. (Reporting by Jeffrey Hodgson; Editing by Anne Marie Roantree.
From reuters.com
