Investec Asset Management, part of UK and South Africa-listed Investec, has said that international multi-family office Fleming Family & Partners, on behalf of its asset management clients, has provided the seed capital for the launch of the Investec Africa Fixed Income Opportunities fund.

The Investec fund is designed to offer investors standalone access to the continent’s sovereign hard and local currency sovereign debt markets and an entry point to the continent’s growth story.

Investec has worked closely with Fleming Family & Partners in structuring the fund. The strategy will be co-managed by Antoon de Klerk and André Roux, supported by the Investec emerging market fixed income team at Investec Asset Management.

The Guernsey-domiciled fund will capitalise on Investec’s experience in African capital markets, having the ability to access African public and private markets across all sectors with US dollar exposure, and to allocate up to 20 per cent of its holdings to corporate debt when opportunities arise. This approach aims to provide high yields as well as lower volatility than other risk assets, the firm said.

“Africa has for several years been the best kept alpha secret in global emerging market fixed income portfolios. The fund is first and foremost an acknowledgement of ten years of broad based African financial market development that goes beyond being a commodity or a global bond-beta story. Key characteristics include relatively low correlation to global asset price volatility, limited interest rate risk, solid yields and the opportunity for broad diversification,” said de Klerk.

“Our research shows that growth in Africa is set to accelerate, as nations invest in infrastructure and as consumer spending grows. In addition, we see improving governance, favourable demographics and abundant natural resources, all of which underpin fixed income returns,” he said.

In other recent developments, last month Investec Asset Management appointed Michael Williams as head of frontier and emerging markets real estate strategies, within the real estate investment team.