American Beacon Advisors (American Beacon), a provider of investment advisory services to institutional and retail markets, has launched the American Beacon Continuous Capital Emerging Markets Fund.
The fund is the first open-end mutual fund from Continuous Capital, LLC, a firm specialising in value equity strategies and an affiliate company of Resolute Investment Managers, the parent company of American Beacon. The fund’s strategy is to identify investment opportunities at the intersection of value and quality and to mitigate volatility by primarily investing in dividend-paying stocks. Three share classes of the fund are available: Institutional Class (CCEIX), Investor Class (CCEPX) and Y Class (CCEYX).
“We’re pleased to partner with Continuous Capital to launch this Fund, which is designed to help investors diversify their portfolios while addressing concerns commonly associated with emerging markets,” Gene Needles, American Beacon’s chairman and chief executive officer, says. “Continuous Capital’s philosophy – establishing a repeatable process that evaluates potential investments, reviewing holdings daily and using a rigorous sell discipline – aligns with our thinking, making them a natural fit to serve as this Fund’s sub-advisor. We are thrilled to bring this product to market.”
The American Beacon Continuous Capital Emerging Markets Fund employs a two-pronged screening process, consisting of both quantitative and fundamental research, to evaluate 4,000 companies in emerging market economies. The Fund is broadly diversified across multiple dimensions – countries, currencies and sectors – both to minimise uncompensated risks and to generate a consistent return profile. Its sector and country exposures will be relatively flat to the benchmark, ensuring the majority of the portfolio’s alpha is generated by stock selection.
“Many US investors are hesitant to invest in emerging markets equity, especially in the current geopolitical climate, because of concerns about volatility and portfolio drawdowns,” says Morley Campbell, Continuous Capital’s president and chief investment officer. “Although tariffs and trade tensions may give investors pause, emerging market valuations are at historic discounts compared to developed markets. What’s more, emerging markets are poised for economic growth as their larger-than-average populations benefit from the spread of technology, creating a case for long-term investment.”