Luxembourg-based Alceda Fund Management has partnered with Philadelphia-headquartered financial services company AFINA Holdings to expand its business in Latin America.

Alceda said the deal with AFINA would help the firm identify new investment strategies in the Latin American market.

Michael Sanders, chairman of the board at Alceda, said investors from Latin America were now looking beyond their own region towards Europe, the US, Africa and Asia for increased returns.

“For many Latin American investors, their key investment concerns are the transparency of the manager and that manager’s investment strategy, liquidity and ease of access to their investments. Through our partnership with AFINA, we are able to offer these investors access to Luxembourg-domiciled funds, especially UCITS approved funds, and to provide confidence to all investors, as well as transparent and well-structured funds," said Sanders.

Alceda and AFINA believe that improved policies are helping Latin America to weather the global economic turbulence and to expand the middle class, which in turn is creating robust demand.

The World Bank estimates that in the past decade the middle class in Latin America has increased from around 100 to 150 million people. Research from AFINA predicts assets under management in Latin America could reach $4 trillion by 2020, with growth rates of around 3.5 per cent.

"This middle class has more disposable income, has increased spending power and is more focused on long-term investment," said David Godfrey-Thomas, chief executive at AFINA.

"High net worth individuals, family offices and multi-family offices are becoming more demanding in terms of investment choices. Likewise, the institutional market is continuing to grow at an accelerated pace. They too are looking for new investment choices," added Godfrey-Thomas.