To offer investors long term capital growth. The Fund is high risk and, therefore, is only suitable for investors who are able to bear the loss of all or part of their capital investment.
During September, the New Star Heart of Africa Fund could not avoid the fall-out from the global financial crisis. It did, however, outperform most of the African exchanges in which it invests through its focus on investing in relatively straightforward unindebted companies.Meetings were held last month with the managers of portfolio companies in Nigeria and Malawi and the directors of various Sub-Saharan companies made presentations at a conference in South Africa. The main messages from such companies were that the earnings forecasts were being met and balance sheets remained strong.Mauritius Commercial Bank, a large position at nearly 3% of the fund, might be described as overcapitalised but its prudent balance sheet approach means that it appears to be a particularly soundly-financed bank while its earnings are growing at a steady pace. The fast-growing Equity Bank in Kenya has positive prospects thanks to its success in lending to small and medium-sized companies and in microfinance.
