Neuberger Berman is expanding its thematic offering with an equity strategy focusing on disruptive innovations and applications in Asia.
Neuberger Berman InnovAsia 5G will invest in innovative technologies and business models in the early adoption phase to capture the expanding thematic universe around 5G technology and will also have the remit to invest in IPOs.
It will be co-managed by former chip designer YT Boon, based in Hong Kong, and Hari Ramanan in New York and will focus on companies with a market penetration of less than 20%, where the majority of incremental growth is driven by Asia.
The team will look for businesses with proven track records and strategic links to established Asian innovation ecosystems - including 5G network infrastructure, internet of things (IoT), digital lifestyle trends and industrial innovations.
Boon said: "Asia is emerging as the new Silicon Valley. Spearheading technology innovation and adoption, this fast-growing region is no longer just a low-cost manufacturing base. By 2025, Asia will dominate 70% of 5G connections globally. In order to capture this enormous potential, we will dynamically allocate to different areas of innovation where we hope to unearth the hidden gems of Asian innovation, which have long runways of growth."
The strategy will comprise between 30 and 60 stocks and will analyse ESG factors in its portfolio construction process.
Ramanan added: "Driven by technology adoption in younger and older generations, Asia has leapfrogged the West to become an innovation powerhouse. The region dominates in leading edge semiconductor manufacturing, digital healthcare and online education services, and has set the scene for e-commerce, robotics, clean tech and logistics."
Boon and Ramanan, who also run the Neuberger Berman 5G Connectivity fund, will be supported by a team spanning China, Hong Kong, Taiwan, and Japan.
Jose Cosio, head of intermediary sales for EMEA and Latin America at Neuberger Berman, said: "Following the success of our 5G Connectivity and Next Generation Mobility funds, and anchored by a six-month distribution partnership with UBS Global Wealth Management, we think now is the right time to launch the Neuberger Berman InnovAsia 5G fund.
"The Covid-19 pandemic has accelerated the demand for connectivity-related investments generally and, through a blend of technology and investment expertise in Asian markets, our team is well positioned to provide clients with an insider's perspective."