It looks like we are about to get a new frontier markets investment vehicle for investors to invest in "emerging-emerging markets" or "pre-emerging markets" depending on which you prefer for a reference. The Morgan Stanley Frontier Emerging Markets Fund, Inc. has been filed and will trade under the ticker "FFD" on the New York Stock Exchange. This is a closed-end fund rather than an ETF, so it can have wild swings based upon the premium or discount it trades at compared to its net asset values.
These are emerging markets rather than the emerging markets which arealready developed like the B-R-I-C nations of Brazil, Russia, India,and China. These pertain to smaller or under-developed nations andregions throughout Africa, the Middle East, Asia, Eastern Europe, LatinAmerica, and the Caribbean. These are also the countries that the IMFor World Bank do not include in the MSCI Emerging Markets Index.
This particular closed-end fund has been given an indication of 12.5million shares and will likely come public at $20.00 per share. MorganStanley is of course underwriting this offering as it is their fund,but the fund is also being sold through Oppenheimer, RBC Capital, andJanney Montgomery Scott.
Jon C. Ogg
August 21, 2008
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