Off-benchmark countries drive returns for LGM frontiers fund

Georgia, Senegal, and Ghana could be the next candidates to be upgraded to MSCI frontier market status, according to LGM Investments' Thomas Vester.

Vester, who manages the $633m LGM Frontier Markets fund and is also chief investment officer at the group, is keen to invest in off-benchmark countries, including 8.5% of the fund in Saudi Arabia, 4.7% in Georgia and 3.7% in Senegal. He said: "One of the factors when deciding whether a country is upgraded to an index is its financial openness. "Georgia has had two IPOs, and if it has one more then it could be viable for it to be upgraded. I also expect Vietnam could be upgraded to emerging market status." However, he added these changes could take some time, and cautioned investors...