Deep Dive: Arguments for frontier markets are compelling

Value more important than cost

Tom Baird, senior vice-president, manager research at Redington, dives into frontier market equities

We often get questions from clients about the potential for investing in frontier markets. The arguments for doing so can be quite compelling.  Countries such as Vietnam, Morocco and Bahrain offer fantastic growth potential, entrepreneurship and favourable demographics. This is where we will find the large companies of the future. It is lowly correlated with other regional equity allocations and will be a great diversifier. It is largely overlooked by investors. The dominance of local investors means high stock dispersion and volatility - which makes it ripe for alpha generation. Ther...