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Everyone knows Barings. The banking name dates back to the 1760s, but the main reason it is so widely recognised is not so much its longevity as its disappearance. Famously, Barings Bank was wiped out in 1995 after rogue trader Nick Leeson lost £827m – twice the company’s trading capital – making uncovered bets on the direction of the Japanese stock market.

The only remnant of the venerable brand is Baring Asset Management, which was acquired by MassMutual, the US life insurer, in 2005 after a decade within the ING Group – the company that bought the failed bank for a nominal £1.

Barings retains the focus of the old Barings Bank on the Far East – though Marino Valensise, chief investment officer at Barings, is quick to point out it has no offices in Singapore, where Nick Leeson was employed. When the firm turned bullish on equity markets last October, shortly after spectacular falls across the globe, its multi-asset team chose to focus not on the traditional defensive sectors such as large-cap US stocks, but instead on China.

So far, this has proved a profitable strategy: while banking problems have pushed the FTSE 100 sideways since the October lows, the Shanghai stock market has bounced 37 per cent.

Mr Valensise says this is partly luck, but he also has clear reasons for believing “the decoupling argument is as strong as it has ever been”. First, he predicts China will be the only economy in the world that will grow substantially in 2009. Second, the Chinese authorities have much greater control over the domestic banking sector than their developed world peers – a crucial extra tool in the fight against global recession.

Summing up the problems facing western central bankers at the moment, he says: “You can create as much money as you want but if the banks put it all into their black hole, that money does not find its way into working capital and the real economy.”

In contrast to China, Mr Valensise sees the laissez-faire US as the ideal Marxist economy in so far as wealth creation, at least in the financial and automobile sectors, has benefited the labour force rather than the capitalists. “If you were a shareholder in Merrill Lynch over the past five years, you lost money. If you were an investment banker, you made millions,” he points out.

Mr Valensise has a further, business-related reason to avoid the US: as one of the most liquid and efficient markets in the world, it offers little scope for product differentiation. Barings would not be able to charge the same premium rates it receives for running its $2.8bn (£2bn) Hong Kong China fund, for example.

“Everyone does US equity – some of them probably better than us from a regional product point of view. It’s not a market where we have anything special to offer,” says Mr Valensise.

Instead, Barings focuses on stock picking in the less efficient capital markets on the one hand and asset allocation on the other – both high-alpha, high-margin activities. It launched an agriculture fund in January, for example. As with the China theme, long-term macro-economic trends provided the underlying rationale.

“The basic paradigm is: which are the countries in the world that are growing from a GDP per capita perspective? That is the basis of everything we do. In those countries, people will be buying more investment services. They will also be eating better – moving from rice to chicken and red meat. It is clear that demand is going to increase,” he explains.

Soft commodity prices have fallen dramatically since last July, when hopes were riding high that farming – one of the less financially developed and leveraged areas of the investment universe – would escape the ravages of what was then still the credit crisis. Yet Mr Valensise says the correction was welcome, adding a ‘value’ element to the theme just in time for the launch.

“It was fantastic timing. We bought these assets at a 50 per cent discount – last summer we would have spent twice as much. Yes, you may have a product collapsing 30 per cent today and another collapsing 50 per cent tomorrow. But 5-10 years from now, one place you want to be is agriculture.

“We like agriculture even more than other things we like a lot at the moment – such as gold. If you see prices going down 50 per cent, you buy. Every time you see a market correction you must buy,” he urges.

Asia, emerging markets and natural resources are three of the six asset classes or strategies that Barings sees as central to its investment philosophy. The others are global bonds – for which it is perhaps best known in the UK retail market after the bond surge of 2008 – European equities and multi-asset investing.

It launched its core institutional multi-asset product, the Baring Dynamic Asset Allocation fund, into the retail market only two weeks ago as the Baring Multi Asset fund. The new vehicle will be managed by Andrew Cole, a member of the asset allocation team headed by Percival Stanion, who lost less money for Barings’ institutional clients than many of his competitors over the past year: Baring Dynamic Asset Allocation fell 6 per cent over the 12 months to March 24.

Rod Aldridge, the new head of UK retail distribution at Barings, has high hopes for the multi-asset sector. Managed funds grew exponentially after 2001 and the experience of the TMT boom and bust, and he expects them to follow a similar pattern this time too, particularly as cash – the only asset class that Mr Valensise was “aggressively underweight” in his March briefing – is now paying a much lower rate of interest than in 2002.

Asset allocation was the last of Barings’ core institutional capabilities to be brought across to the retail market place. Mr Aldridge says the new multi-asset fund is the last vehicle advisers can expect the company to launch for the time being.

“Now the focus is building up our market share in the six core product areas,” he explains.

Since Mr Aldridge’s arrival from Gartmore Investment Management in September 2008, Barings has hired two further senior sales personnel to support him, taking the team to a total of six. He cites this as evidence of the company’s commitment to the UK retail market: “We were recruiting at the end of last year – there aren’t many firms that can say that.”