WHY AFRICA

Investing in Africa offers a unique opportunity for investors to take advantage of high risk-adjusted and diversified returns. Africa enjoys a range of favourable factors typically unavailable in other markets.

Our Investment Philosophy

Africa Select Equity Fund is a long-only investment fund, focused on investing in publicly traded companies operating predominantly in Africa, excluding South Africa. The fund is opportunity-driven and has no sector or country bias.

The fund is long-term oriented and seeks to systematically invest in a limited number of high-quality, significantly undervalued businesses which offer the highest risk-adjusted returns to investors. The fund is also characterised by a low turnover.

The fund’s investment process is led by a detailed bottom-up analysis, and is complemented by regular management interviews and site visits. Its philosophy and investment process are centred on the margin of safety in order to protect investors’ capital. Sustainability is another key element in the research and selection process to ensure all risks are adequately accounted for.

The culture is characterised by diligence, discipline, and patience.

Our Investment Process

We look for well-managed, high-quality businesses offering strong and sustainable competitive advantages, good growth prospects and high returns on capital. We take a long-term view on companies, and our strategy is to maintain a portfolio consisting of 20-25 of the highest conviction investments with superior expected returns and limited downside risks.

Partners

Africa Select Equity Fund is regulated in Malta and is licensed by the Malta Financial Regulatory Authority (MFSA) as a UCITS Scheme.

The fund is supported by leading institutions in the financial sector: APEX, European Depositary Bank, Citibank, PwC, FFF Legal as well as an established network of brokers.

Financial regulators:
Service providers:

Risk Management

The Africa Select Equity Fund’s philosophy and processes include several aspects of risk management.

Investment Risk

Investment
Risk

Mitigated by a deep understanding of the underlying fundamental value of companies, ensuring that investment returns are maximised and investment mistakes are minimised. Position sizing, and the margin of safety are key considerations in the portfolio construction process.
CONCENTRATION RISK

Concentration
Risk

The fund adheres to investment limits that impose restrictions on maximum exposure per position, sector, and country. The limits serve as a safeguard against unforeseeable events and aim to protect the interests of investors without compromising the fund's performance.
Liquidity Risk

Liquidity
Risk

Liquidity risk is managed through negative screening and by following well-defined liquidity criteria. The structure of the fund, coupled with the capping of its size, allows it to capitalise on lucrative investment opportunities, all the while maintaining adequate liquidity to meet investor redemptions.
GOVERNANCE RISK

Governance
Risk

Poor corporate governance and unethical practices are typically revealed through the due diligence process. The fund engages with companies to uphold the highest corporate governance standards.
Transparency Risk

Transparency
Risk

Our exhaustive research and regular contact with companies coupled with frequent site visits enable us to isolate lucrative opportunities from value traps.
CURRENCY RISK

Currency
Risk

Managed by adopting a bottom-up approach and often mitigated by investing in businesses capable of withstanding local currency volatility.