‘Geopolitical uncertainty creates attractive opportunities’

The founder and chief investment officer of Coller Capital says the secondaries firm will focus on real assets, including natural resources, amid shockwaves created by Brexit, the Trump administration and emerging-market concerns.

Economic and political uncertainty in the US and the UK and concerns about growth and stability in emerging markets are the biggest challenges to investing this year, according to Coller Capital’s founder and chief investment officer, Jeremy Coller.

The ramifications of Brexit negotiations and the Trump administration are “difficult to forecast”, Coller wrote in the firm’s Annual Report and Financial Statements for the year ended 31 March.

“Geopolitical uncertainty makes decision-making harder, but it also creates attractive investment opportunities for secondaries funds,” he wrote.

Despite the concerns, which include the slowing growth rate in China, turmoil in the Middle East and “real challenges” in several African and Latin American economies, broad-based improvements in the world’s economic fundamentals justify cautious optimism, Coller wrote.

The report was filed with Companies House on 7 August.

Amid heightened competition and dry powder – of which Coller estimates there is around $75 billion – the firm will focus on real assets such as real estate, infrastructure and natural resources, as well as credit, as secondaries opportunities in these increasingly emerge.

“The secondaries market is evolving rapidly, and new opportunities will be created as private equity continues to advance in to new areas,” Coller wrote. The firm will continue to be an “active innovator” in these sectors.

Coller also has a personal interest in the agri-business asset class, being at the forefront of efforts to combat antibiotic overuse and decreasing food safety standards as a founding member of Farm Animal Investment Risk and Return.

Launched last year, the initiative is backed by investors managing about $3 trillion. These include: Aviva Investors, ChristianSuper, Boston Common Asset Management, Farmland LP, Triodos Investment Management and the Strathclyde Pension Fund.

Additional reporting by Matthieu Favas