Amundi announced the launch of Amundi Funds New Silk Road. The fund seeks investment opportunities in the markets benefiting from the development of new trade routes across Asia, Europe, Middle East, and Africa.

Using the ancient Silk Road as an inspiration, China proposed the Belt and Road initiative (BRI) in 2013, which acts as a catalyst for new trade routes and growth across Asia, Europe, the Middle East, and Africa and stimulates economic growth and capital formation beyond China. This new eco-system will be covering more than 65 countries, with EUR 1,000 billion (US$ 1,113.96 billion) of planned investments in 1700 infrastructure projects.

The Amundi Funds New Silk Road seeks to achieve long-term capital growth above the broader Emerging Market equity universe, by investing in the equity of companies which derive substantial revenues in markets and/or has a significant business that benefits from the development of the new silk roads. But rather than just focusing purely on investments that could benefit from first-order effects from China’s BRI.

The investment process is designed to navigate geopolitical sensitivities along the New Silk road, integrating top-down analysis with stock picking. Ideas that fit the thematic are primarily sourced from the broader Emerging Market Equities teams, underpinned by thorough fundamental research. Once suitable stocks have been identified, the integration of Amundi’s Emerging Market macro views combined with further country, sector and style analysis drive allocations. Finally, the portfolio is optimized using a proprietary portfolio construction technique to arrive at a balanced risk distribution. The final goal is to arrive at a high-conviction portfolio of 60-90 names. The launch comes on the back of a successful launch of New Silk Road cross-asset solutions, which have collected more than EUR 459 million (US$ 511.30 million) since April 2019.