NEW YORK, Aug. 24, 2010 (GLOBE NEWSWIRE) -- Nile Capital Management, LLC, has released a new white paper compiling research to explore the current investment opportunity in African markets. In the report, titled "A Time to Invest in Africa," Larry Seruma, the company's chief investment officer, presents twelve reasons why he believes African markets are now compelling for US-based investors. The report may be read in full on the Nile Capital Management web site: http://www.nilecapital.com/research.php
The white paper presents a comprehensive look at the "ground floor opportunity" in Africa, noting that a composite index of the continent's key markets returned over 13% annualized during the past decade. As was the case with the better known BRIC markets, "the first investors to enter new high-growth markets often reap the highest returns over time." Seruma explains that Africa may now be poised to continue an upward trend similar to that which the BRIC markets experienced, with the added advantage of benefiting from more rapid changes driven by globalization, advances in communication and technology not available to previous "frontier markets."
Seruma looks at various independent and co-dependent factors that support upward growth trend in Africa. Political and economic reforms, coupled with strong, functioning democracies, as well as steadily increasing capital flows have created new momentum for strong growth in many countries. Africa, rich in natural resources, also benefits from growing global commodity demand, particularly from China. As a result, China has invested heavily in many African countries, helping to build out infrastructure while rapidly increasing its trade ties to the continent. The white paper cites extensive data relating to this "China Effect" on Africa's development.
In addition to the potential for high growth over time, the white paper's research shows that African markets make for an attractive diversifier with low correlation to developed, international and emerging markets. The report features new data demonstrating this historically low correlation of African markets with both the S&P 500 and MSCI EAFE indices.
While Africa represents an attractive opportunity for investors experienced with emerging and frontier markets investing, the white paper also points out the factors that make Africa a volatile market. The paper contains information on Nile Capital's approach to investing highlighting the firm's access to "feet on the ground" in Africa and Seruma's personal investment experience. The team at Nile Capital Management has a sole focus on investing in Africa and working together to develop a "360-degree view of the continent, its national economies and leading public companies."
Nile Capital Management, the Advisor to the Nile Africa series of funds is a New York-based asset management firm with in-depth investment expertise that covers the entire African continent, from Cairo to Cape Town. By focusing on Africa, the company seeks to identify and capitalize on the best investment opportunities in the continent and expand investor's access to emerging/frontier markets. Additional information is available at http://www.nilecapital.com.
The Nile Capital Management, LLC logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=7912
Mutual Funds involve risk, including possible loss of principal. Because the Fund will invest the majority of its assets in African companies, it is highly dependent on the state of the African economy and the financial prospects of specific African companies. Certain African markets are in only the earliest stages of development and may experience political and economic instability, capital market restrictions, unstable governments, weaker economies and less developed legal systems with fewer security holder rights. Adverse changes in currency exchange rates may erode or reverse any potential gains from the Fund's investments. ETF's are subject to specific risks, depending on the nature of the underlying strategy of the fund. These risks could include liquidity risk, sector risk, as well as risks associated with fixed income securities, real estate investments, and commodities, to name a few. Non-diversification risk, as the Funds are more vulnerable to events affecting a single issuer. Investments in underlying funds that own small and mid-capitalization companies may be more vulnerable than larger, more established organizations.