Barings Global Agriculture Fund
as of 23/07/2019
|Umbrella||Barings Investment Umbrella Fund|
Share Class Info
|Share Class||Class I USD Acc|
|Accumulating / Distributing||Accumulative|
|Share Class Inception Date||20/01/2016|
The investment case for agriculture is exciting and continues to be driven by sustainable global demand on one side and the instability and inadequacy of supply on the other. We believe that the business of feeding the world merits consideration for any well diversified, long-term investment portfolio.
Summary fund objective
The investment objective of the Fund is to achieve long-term capital growth by investing in the agricultural sector.
The Fund will seek to achieve its investment objective by investing at least 70% of its total assets directly and indirectly in equities and equity-related securities in any company, including those in developed and emerging markets, where the majority of earnings of issuers or holding companies are derived from activities related to any commodities which are grown or raised, commonly known as agricultural or soft commodities.
These companies are likely to encompass, without being limited to: fertiliser, agricultural machinery, animal feed, seed and crop protection manufacturers, agricultural producers including farms, plantations and aquaculture, crop processors, grain and edible oil handlers and distributors, timber, pulp and paper, food ingredient companies, food manufacturers and food retailers.
For the remainder of its total assets, the Fund may invest outside of the agricultural sector, as well as in fixed income and cash.
While the Fund will aim to diversify its investments, allocation to certain countries may be more than 30% of its total assets depending on the Investment Manager’s assessment at different times.
In order to implement the investment policy, the Fund may gain exposure through American depositary receipts, global depositary receipts and other equity related securities including participation notes, structured notes, equity-linked notes and debt securities convertible into equities. The Fund may also invest in collective investment schemes and other transferable securities. It may also use derivatives including futures, options, swaps, warrants and forward contracts for efficient portfolio management and for investment purposes.
Well supported commodity prices have improved farming economics and provided a strong incentive for farmers to maximise output. We believe that this will continue to have positive implications on a number of sub-sectors such as agrochemicals, agricultural machinery and grain handling and processing services. As such, we expect to see robust investment into areas such as agrochemicals and agricultural machinery over the coming months.
Outside of these markets, we are also seeing growing interest in alternative energy sources such as biofuels, where agricultural products are the main inputs.
The Barings Global Agriculture Fund is able to invest ‘from farm to fork’ - in any company where the majority of earnings are derived from activities related to agriculture and soft commodities. This flexibility means that the Fund does not need to rely on rising commodity prices to add value and through identifying suitable companies has the potential to perform well across a range of market conditions.
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