Products February 28, 2011

Goldman Sachs Launches N-11 Equity Fund

Goldman Sachs Asset Management International announced the U.S. launch of the Goldman Sachs N-11 Equity Fund (Class A shares: GSYAX).
Reported by

The fund is a long-only U.S. mutual fund that invests in equity securities in the “Next Eleven” (N-11) countries including Bangladesh, Egypt, Indonesia, Korea, Mexico, Nigeria, Pakistan, Philippines, Turkey and Vietnam. The “Next Eleven” (N-11) concept was established by Jim O’Neill and the Goldman Sachs Global Economics, Commodities, and Strategy Research Team in 2005 to identify fast-growing countries that could potentially follow the BRIC economies in having a major impact on the world.   

The Goldman Sachs N-11 Equity Fund utilizes the MSCI GDP Weighted N-11 ex Iran Index to benchmark the Fund’s performance. This new benchmark is based on the current GDP of the N-11 countries. In addition to Class A shares, the fund is also offering Class C shares, both with $1,000 minimum initial investments. The fund also offers Institutional Shares and Class IR shares.      

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GSAM’s Global Emerging Markets Equity team will manage the Fund.   

“The Goldman Sachs N-11 Equity Fund allows U.S. investors to access markets that together constitute the next set of large-population countries beyond the BRICs through a single equity investment,” said Jim O’Neill, Chairman of GSAM, in the announcement. “Driven by attractive demographics, rising income and increased domestic consumption, the N-11 countries could become significant contributors to global growth in the next decade and beyond.” 

The Markets February 28, 2011

Strong 4Q for Money Management Firms

The fourth quarter of 2010 witnessed a healthy rebound in asset manager margins, according to kasina.
Reported by

The strong showing was supported by an 11% gain in The Dow Jones Total Stock Market Index, kasina found. Quarter over quarter, industry operating margins increased from 27.5% to 31.4%, and net margins increased from 21.2% to 23.4%. Firm-to-firm variations remain, but overall, margin compression pressures and worries that were prevalent in early 2010 have eased.

“Firms are above pre-crisis profit margin levels, supported by a combination of surging markets and some belt-tightening,” said Eric Daugherty, Director of Research and Principal. “From an operational perspective, many firms are actually in a better position than they were in 2007 and 2008. Margins are back to attractive levels, but the market is still substantially below its high.”

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Although firms tend to cluster in a pack, the results highlight the opportunities for both large scale players and small, niche asset management firms. Leading the large firms were Franklin Templeton and Blackrock, while Pzena and Calamos continue to lead the smaller firms in operating margins, kasina reported.

The company said asset managers continue balancing gains in short-term profits, with investing adequately in technology and innovation, to build industry leading organizations for the long term.

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