Investing in Africa looks a good long-term bet. But preserving capital in such volatile markets - and hedging all the various market, economic and political risks - is not easy
On a trip to Egypt many years ago, Francis Beddington, now head of research at Insparo Asset Management, inquired about shorting the currency. "We consider that treason," came the reply.
The paucity of shorting instruments on African exchanges remains today, although not quite to the same extremes as markets evolve. Yet being able to hedge downside risk is a key issue for investors, given that African markets - often billed as uncorrelated due to their frontier nature - proved decidedly correlated with big global markets in 2008.
What is more, many have so far lagged the recovery seen elsewhere