Goldman closes its BRIC fund

How ironical to see Goldman close its BRIC Fund. It created the BRIC acronym from nowhere and created huge hysteria and hype. Just recently the BRICS nations have started their own bank and are pretyy gung ho about the whole group members.

And after all this, it goes on to close its own BRIC fund.

The BRIC era is coming to an end at Goldman Sachs Group Inc.

The bank’s asset-management unit folded its money-losing BRIC fund, which invests in Brazil, Russia, India and China, and merged it last month with a broader emerging-market fund. Goldman Sachs pulled the plug on the nine-year-old product because it doesn’t expect “significant asset growth in the foreseeable future,” according to a filingto the U.S. Securities and Exchange Commission.

Fourteen years after former Goldman Sachs economist Jim O’Neill coined the acronym that ushered in an unprecedented investment boom, the biggest emerging markets are now sputtering. Russia and Brazil have fallen into recessions. China, long an engine of the world’s growth, is poised for its weakest expansion since 1990.

 The downfall of the BRIC fund, which had lost 88 percent of its assets since a 2010 peak, also underscores how the strategy of bundling disparate countries into a single investment theme is losing its appeal among investors.

“The promise of BRIC’s rapid and sustainable growth has been challenged very much for the last five years or so,” said Jorge Mariscal, the chief investment officer of emerging markets at UBS Wealth Management, which oversees about $1 trillion. The BRIC concept was popular. But nothing is eternal.”

The BRIC fund is being swallowed up by the Emerging Markets Equity Fund as part of Goldman Sachs’s efforts to “optimize” its assets and “eliminate overlapping products,” the New York-based bank said in the Sept. 17 filing.

All such hypes usually have a pretty sad end..

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