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Verno Capital launches long-only Russia fund

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Verno Capital, the specialist fund manager focused on Russia and the CIS, has launched the Verno Capital Growth Fund. The fund is launching with USD40 million in commitments from institutional investors in the United States and Europe.

 

Verno Capital Growth Fund is an actively managed long-only fund benchmarked against Russia’s RTS Index. The fund seeks to outperform the index through fundamental stock selection based on a rigorous bottom-up investment process.

Dimitri Kryukov (pictured), Founder and Chief Investment Officer of Verno Capital, says: “The new long-only fund allows investors with a longer-term investment horizon who can tolerate the market volatility to get exposure to Russia’s high-growth market. I believe our team’s local presence and experience can mitigate risk and generate alpha for our investors. The commitments by our founding investors are a vote of confidence in Verno Capital as well as in the opportunities in the Russian market.”

The new fund is managed by Verno Capital portfolio manager Bruce Bower. From June 2006 to July 2009, the fund for which Bower was responsible outperformed the RTS Index by more than 50 percentage points.

Bower says: “The fund’s goal is to profit from the excellent opportunities in Russia and the CIS. The region offers a large and fast-growing economy that is benefitting from global demand and internal reforms; a liquid and diversified stock market; and valuations that are historically at record discounts. Given the complexities and nuances of the market, we believe that our local presence and intensive research can add significant value for long-term investors.”

Verno Capital Growth Fund is the firm’s second fund launch. In January 2010 the firm launched the Verno Russia Fund, which employs active hedging strategies to mitigate volatility and downside risk. In November 2010 Mubadala, the Abu Dhabi‐based strategic development and investment company, agreed to invest USD100 million in that fund. That agreement represented Mubadala’s first investment in the Russian market.

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