BNP Paribas Asset Management today launches Parvest World Financials, a new sector-focused sub-fund of the Luxembourg-based Parvest fund designed to enable investors to take advantage of opportunities arising from global trends in the financial sector by investing in banking, financial and insurance stocks.
The managers of the fund are betting on several favourable trends in financial services. One is its sheer size (the financial sector is now the biggest in terms of global market capitalisation) and variety. “By its size, the sector’s vast investment universe opens the way to> active and very selective management,” says the French bank. “The investment possibilities create new opportunities. These range from retail banks able to withstand periods of economic slowdown to investment banks, which are better placed to benefit during periods of recovery.”
But Paribas also expects the present round of mergers and cutbacks in both retail and investment banking to produce value-adding productivity gains in the sector, which is alreday rteceiving a boost from new technology. Of course, consolidation itself will produce gains as well, as banks and insurers over-pay for each other. That old chestnut – thre coming revolution in personal pension funds, especially in Europe, leading to sales booms for insurance compoanies and banks – is another reason BNP Paribas Asset Management is confident the financial sector will out-perform.
Parvest is the Luxembourg flagship umbrella fund of BNP Paribas Asset Management. Established in 1990, it now sports 78 sub-funds covering all major asset classes and markets, and is distributed in 22 countries.