Excel Funds Management Inc.

Emerging Markets


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Mexico, Chile and Columbia maintained strong growth metrics

The Latin American growth gap, or the rate of growth differential between countries measured by GDP, may have peaked in 2012 according to HSBC analysts.

While Brazil and Argentina showed signs of deceleration, Mexico, Chile and Columbia maintained strong growth metrics.

HSBC says “In the case of Mexico, a virtuous cycle of initiatives by policymakers and investment decisions by firms appears to be emerging. In Brazil, we currently observe the opposite”.

Forecasts for GDP growth in the region come in at “4.8% for Chile, 6.2% for Peru and 4.3% for Colombia”.

Both the Excel Latin America Bond Fund and Excel Latin America (Equity) Fund are two great investment vehicles helping Canadian investors capture the tremendous economic performance opportunity of the Latin American region. With geographic diversification and leading portfolio managers managing an Excel fund we aim to provide investors with both value, strength and expertise.

Written by Jack S.

Read More:
http://www.emergingmarkets.org/Article/3138072/Economics-and-Policy/Latin-America-outlook-Brazil-may-rebound-this-year.html

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Merrill Lynch favors EM over developed countries

Merrill Lynch Chief Investment Strategist Michael Hartnell favors EM over developed countries. The EM have been outperforming even though commodities are weakening. Michael Hartwell and his team believe the reason behind the strength of EM is the consumption story rather than the dependence on commodities.  They are also bullish on EM bonds over developed countries.

Excel has 12 funds raging from country specific or a general EM fund. Now is the time to take advantage of EM markets as they continue to grow.

Written by Jeff K.

Barrons. (2012). BofA Merrill Lynch Strategist Favors Emerging over Developed Markets. Retrieved November 19, 2012, from http://blogs.barrons.com/emergingmarketsdaily/2012/11/16/bofa-merrill-lynch-strategist-favors-emerging-over-developed-markets/?mod=google_news_blog


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Emerging Markets drive Coca-Cola Profits

The Coca-Cola Co. says its net income rose 3 per cent in the third quarter, as the world’s biggest beverage maker expanded in in emerging markets and sold more of its sports drinks and teas at home.

The Atlanta-based company, which makes Sprite, Fanta, Minute Maid and Dasani water, says global sales volume rose 4 per cent during the period. But the growth was more pronounced in emerging markets, where Coca-Cola has been looking to capitalize on the growing ranks of middle-class consumers.

In its flagship North American market, the company said sales volume rose by 2 per cent. The increase was driven by what Coke refers to as “still beverages,” such as Powerade, Gold Peak and Fuze teas. Its sparkling beverage unit, which includes its namesake soft drink, was flat from a year ago.

In India, by contrast, the company saw a 34 per cent increase for its Coca-Cola brand and a 15 per cent increase for Sprite. Overall sales volume in India was up 15 per cent during the period.

This is a message that we must communicate to our clients, this just goes to prove on how large multinationals continue to seek growth outside of the traditional markets. This growth that we continue to see and growing middle class goes to show the importance of having exposure to these markets are so important. The Excel Blue Chip Fund is great for investors seeking exposure to these markets, but having the comfort of staying at home with their investments.

Written by Sam A.

Source: Emerging markets drive Coca-Cola profits


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Fast-food company Yum Brands predicts more strong growth in China in 2013

Despite the slowing of the economy, the owner of Yum Brands predict that its fast growing China business will have another strong profit growth next year. There will also be more menu options in the coming year for Taco Bell in the U.S. Yum’s stock rose more than 8% to $71 in afternoon trading. The executives are confident that they will gain 15% profit growth in China next year. Analysts are forecasting a rebound in China late this year or in early 2013 after the economic growth fell to 7.6% this past spring. That turnaround in China, couples with strong profit growth at its restaurants in the U.S. and else ware around the world, helped Yum post a 23% increase in its third-quarter net income. China has 4,000 KFCs and has ramped up its breakfast offerings. Pizza Hut has a growing presence there too. In the U.S., Taco Bell has been the catalyst behind Yum’s strong performance. Third-quarter operating profit in the U.S. rose 13 per cent. Sales in U.S. restaurants open at least a year rose by 7% at Taco Bell in the quarter. This year alone, Yum expects to open up at least 750 stores in China. Yum has more than 38,000 restaurants in more than 120 countries and territories.

 

“But as I’ve said before, China is going to have its inevitable ups and downs. … We now face a slowing economy. But that doesn’t change our long-term outlook in China one iota,” Yum Chairman and CEO David C. Novak told industry analysts Wednesday. People still have hope for China and its long term growth potential. By owning our China fund, investors will gain investment exposure to one of the fastest growing regions in the world and benefit from the strengthening currency of China. And if the risk is too high for certain clients, our Blue Chip is another option where Yum brands is constantly on the radar. With our Blue Chip, investors are able to participate in the growth of the economies with lower volatility. So, you get the best of both worlds; the stability of the developed worlds, U.S and Canada, and the growth from the Emerging Markets.

 

Written by Melissa W.

 

http://www.canadianbusiness.com/article/101791–fast-food-company-yum-brands-predicts-more-strong-growth-in-china-in-2013


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The central bank of China, injected 265 billion yuan ($41 billion Cdn) into the country’s money markets Tuesday in a stimulus measure aimed at keeping short-term interest rates low.

The central bank of China, injected 265 billion yuan ($41 billion Cdn) into the country’s money markets Tuesday in a stimulus measure aimed at keeping short-term interest rates low.

It was the second biggest debt purchase ever by the People’s Bank of China and came a week before the government comes out with its latest report on quarterly growth.

Economists expect it will show that growth has slowed for the seventh straight quarter.

But authorities are moving more cautiously than they did after the 2008 crisis, when the huge stimulus that helped China rebound also fueled inflation and a wasteful building boom.

China’s economic renaissance is now in its fourth decade. One of its striking features, in addition to its success, is its constant state of change. The types of goods produced, the degree of dependence on cheap labor, the relative openness of markets and currency, all have changed dramatically in the 33 years or so since Deng Xiaoping first began the reform movement. From most reports, it appears that more changes in the direction of economic openness are currently at hand. The current stimulus measure should provide some easing in keeping the short-term interest rates low.

Why does this progress take place? Could it be that the leaders of China have a vision of the future that entails a continuing opening of the economy? Could it be that the leaders of China have aspirations for the Chinese people that require that they become better off economically? Could it be that the leaders of China believe that China’s future will be built on education, creativity, personal discipline, and hard work? My guess is that the answer to all of those questions is “yes”.

With this week’s stimulus measure it is another sign that the Chinese are committed to have the economy grow at a faster pace than we have seen of recent times. China will no doubt the new top economic power in the world investors must wake up to this and be invested long-term and share in this success story.

Written by Sam A.

Source: China’s central bank boosts economy


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Institutions are increasingly searching for alternative yields…

Melanie Trimbell, of the Financial Standard, recently wrote Fund Managers are bullish on Bonds due to the recent announcement of QE3 and the ECB’s concerted bond buying program.

In an interview with Trimbell, Geoff Pidgeon head of asset management for HSBC in Australia said “ institutions are increasingly searching for alternative yields”.

The article does a good job of explaining the dynamics of the fixed income market in terms of local denominated fixed income and hard currency, or USD denominated, fixed income. Historically emerging markets offered higher yields but were not considered safe havens. However recent noticeable momentum in spreads and fundamental resilience in Asia’s corporate fixed income space has led to Asia fixed income having increased appeal.

The Excel Income Funds have done a great job for investors in participating in yield enhanced geographic areas ,such as Asian Fixed Income, as well as other regions that Sergei Strigo identifies as having momentum.

Written by Jack S.

Read more [webpage]: http://www.financialstandard.com.au/news/view/23140897


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Many of the BRIC countries are rich in resources, have an abundance of young and very educated work force that will continue to accumulate wealth and therefore demand and consume more.

There are numerous reasons to invest in BRIC countries over the next decade.  First and foremost, the BRIC and emerging markets nations are not riddled with debt and are building up their foreign currency reserves which has helped them enjoy credit upgrades rather than downgrades by S&P and Fitch which we have noticed with a number of developed nations over the past year.  Many of the BRIC countries are rich in resources, have an abundance of young and very educated work force that will continue to accumulate wealth and therefore demand and consume more.  Nigel Green who is the boss of the world’s leading independent financial advisory group says that “Aggregate consumption between the four countries is currently estimated to be around 4 trillion dollars and this is expected to grow by around 15% to 20%. Therefore, by the middle of the decade, the BRIC nations will see their combined consumption increase by more than a trillion dollars – and this is a conservative estimate.”  Starbucks is quick to recognize this domestic consumption story and will be trying to capture part of the growth by opening its first establishment next month as part of an overall investment of approximately $78M in the subcontinent.  Green believes it would be wise given the current market conditions to have a very diversified portfolio and to follow in Starbucks strategy and incorporating BRIC nations in your balanced portfolio.

 

Goldman Sachs Jim O’Neill also believes that the Next Eleven (N-11) namely Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, Turkey, South Korea and Vietnam, alongside the BRIC nations are also very noteworthy countries to be investing in over the next decade.  Mr Green notes that “It is estimated that within the next decade the combined GDP of the BRIC and N-11 countries will be double that of Europe and the US together.”

 

With this in mind, our BRIC Fund not only invests in BRIC countries but also other emerging markets nations, is coming up to a 3 year track record come November 2nd, 2012.  It is not only the best performing BRIC mutual fund in Canada but it has also done well this year with a gain of 5.89% YTD (Source: Globefund as at October 5, 2012).

 

Written by Devin L.

 

Please see the following article for more information:

http://investmentinternational.com/news/alternative-investments/follow-starbucks-example-5155.html