Public Markets

Silk Invest currently offers three investment strategies managed by its public markets investment team.

Each product provides a different avenue to access these intriguing yet relatively untapped markets that carry a wealth of growth potential. We strongly believe in the product set we offer and therefore we invest our own capital into our funds to establish our alignment with our clients.

We, at Silk Invest, firmly believe that our fundamentally orientated strategy, combined with our local expertise offer a compelling insight into the Frontier & Emerging markets at a time where we are yet to see them reach their full potential.

How we invest

Silk Invest applies a well-defined, disciplined investment approach to each asset class, that aims to deliver returns over different market cycles in a consistent manner.

Within Equities, Silk Invest’s strategy focuses on investing in stocks which will both outperform their local peers and become true leaders in their field. We strongly believe in the short and long-term structural opportunity in the frontier markets, and the advantages for investment analysts and decision makers to be on the ground to capitalize on it. Silk Invest’s investment process incorporates fundamentally-driven, bottom-up stock analysis designed to outperform in the longer term with reduced volatility.

We maintain an unconstrained non-benchmark approach and invest in companies with successful local business models whose demand is driven by local consumers. The portfolio building process incorporates ESG standards and is designed to maximize annual returns while maintaining maximum diversification across the regions and sectors. The investment approach of Silk Invest is built upon these insights and perspectives.

Investment Approach

Bottom-up focus on business models

  • FM opportunity is not a top down bet on markets but a bottom-up investment in individual companies
  • Understanding market positioning, ability to sustain profit margins and management team is key

Local context in under-researched environment

  • Understanding local context helps to identify companies which have answers to local challenges
  • Only a select number of FM companies have the ability to fully capture the FM opportunity

Team approach but with clear decision making

  • Local specialists are fully empowered to source and identify local investment ideas
  • Investment committee owns the portfolio construction and top down macro overlay

Structural bias away from risk

  • No investments in volatile commodities companies
  • Deep exposure to broad consumer themes across market cap levels

Quantitative tools facilitate decisions

  • Universe screening model helps to focus assessment on highest potential firms
  • Target prices for all stocks using combination of tools including DCF and Multiples analysis

Track record of outperformance with lower risk

  • Long term investment horizon with the objective of outperforming reference indices with reduced volatility
  • Positioning as “no drama” investors with low turnover in a focused portfolio composed of high quality and well managed companies

ESG & SRI is not a tick box exercise

  • Signatories of UN Principles for Responsible Investment with six internally defined ESG criteria tilted to sustainability
  • Focus on alignment between management/shareholders and between companies/consumers

Our Strategies

Silk Invest has two distinct investment teams covering:

  • Public Markets – Three strategies focusing on Frontier Markets Equities, African Equities and African Fixed Income
  • Private Equity – A dedicated African Food fund investing in FMCG and a joint venture with a Nigerian real estate developer.
 

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