Investors bet on banks amid equity rebound

May 1, 2017

Equity fund flows are soaring, reversing years of exits from the asset class, yet risks still linger in Latin American stocks. The best investors are picking carefully.

Aaron Weinman

As Latin American economies have gathered speed over the past 12 months, equity fund returns have bounced back. It has been a great year for the best performers, with returns deep into double-digits. 

T. Rowe Price's Latin America Equity Fund, for example, returned 27.7% in the 12 months to the end of March, and Aberdeen Asset Management's Latin America Equity fund posted a 32.2% return, according to performance data from Lipper. The funds rank first and second on LatinFinance's 2017 Equity Investor Scorecard, which assesses the three-year performance of portfolios with at least 90% of their assets invested in Latin America. 

The best-performing funds notched solid returns from a wide range of investments. Financial institutions came into fashion, while portfolio managers took a renewed shine to Brazilian and Argentine companies. 

Indeed, Latin America’s largest economy was the main pick for fund managers. Equity flows into...

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