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Alternative Market Briefing

GEM managers optimistic despite Emerging Value Opportunities Fund’s return of -40% YTD

Tuesday, August 17, 2010

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Philipp Haas
From Precy Dumlao, Opalesque Asia:

GEM ’s Emerging Value Opportunities Fund (EVOF), managed by Bahamas-based emerging markets-focused investment manager GEM Global Equities Management S.A., was down 3.3% in July (and down 40.7% YTD). The fund is up 122.5% since its 1993 inception and the NAV is $673.46 as at 31-July.

Comparatively, the MSCI Emerging Markets Total Return Index was up by 8.3% (1.7% YTD) and the MSCI AC World Total Return Index was up by 8.2% (-1.7% YTD) during the same month.

In a July 2010 newsletter, the managers said that despite recent indications of slower growth in the U.S. economy and some easing of China’s expansion, the macro “big picture” still looks encouraging: “The main risks to the outlook are an adverse impact to growth arising from stiff fiscal tightening in the Eurozone which does not ‘crowd in’ business investment but instead just results in a slide in economic growth. Rising protectionism also remains a threat though the risks of a US-China trade war seem to have dissipated recently.”

Pharma industrial development “very much going according to plan” On the Eurozone healthcare sector, profit squeeze hit drugmakers as Europe crisis leads to cuts. And Germany, Greece and Spain have cut or plan to reduce their health spending after European Union policy makers agreed to an almost $1tn rescue fund in May to prevent the fiscal collapse in Greece from s......................

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