By Biz Times
INVESTORS should be prepared for unforeseen shocks that could substantially threaten the robustness of the global economy in 2008, HwangDBS Investment Management Bhd (HwangDBS IM) chief executive officer and executive director Teng Chee Wai said.
He said the stage should be set for a weak US dollar to continue into next year, although he believes the Malaysian economy will be able to withstand external shocks including a recession in the US.
In a statement, Teng said the recent financial crisis has the potential to be a blessing in disguise for Asia and may present an opportunity for the region to showcase its resilience.
A dampened US economic outlook should increase the urgency within Asia to step up efforts to shift its growth dependency away from external demand, and to steer fiscal/monetary policies towards boosting demand.
This process should be facilitated by orderly adjustments in their undervalued currencies, stronger balance of payments and improved international liquidity positions.
"With the US consumer encumbered by mortgage financing woes, the rise of the Asian consumer should attract the attention of foreign investors. At the country level, it is the countries where domestic demand has been strongest - such as Singapore and Malaysia - where there has been the largest disconnect between the earnings cycle and the US economic cycle," he said.
HwangDBS IM recently launched its first performance-based fund, the HwangDBS Ascendur RIS 1 (HARIS1).
Targeted at the mass affluent, the unique features of the fund are the lower sales charge or front-end fees of a maximum charge of two per cent as opposed to the four to six per cent characteristic of equity unit trust funds, as well as the performance attribute which allows the manager to levy a performance fee if HARIS1 exceeds the pre-determined minimum return benchmark at eight per cent per annum.
The launch of HARIS1 represents HwangDBS IM's eighth fund for 2007.
Teng said the unique features challenge market convention but are necessary in the increasingly competitive marketplace.
"Managing absolute return mandates or funds is nothing new to HwangDBS IM. When we started out in 2001, it was a surprise to the industry when we set an absolute performance benchmark and included a fee on the performance as an incentive for the manager, in the event of positive performance.
"Since then, such features have become more common but somewhat limited to the management of discretionary mandates. Our main objective in bringing such a fund to the local market is to plug the gap between the mass retail and such services by introducing a product targeted specifically at the mass affluent but with elements of a discretionary mandate.
"At the same time we aim to ensure that investors are able to potentially reap more meaningful returns because of the lower fees," Teng said.
HARIS1 will primarily invest in equity securities of developed and emerging markets globally. It may also invest in fixed income securities of developed markets or debt instruments.
HARIS1 has an approved size of 200 million units priced at RM0.50 per unit. The minimum initial investment sum is set at RM500,000 and the minimum additional investment is RM100,000.
HARIS1 is a mixed securities and growth type fund targeted at medium to long-term investors who are risk tolerant and are seeking higher capital returns on their investments.
INVESTORS should be prepared for unforeseen shocks that could substantially threaten the robustness of the global economy in 2008, HwangDBS Investment Management Bhd (HwangDBS IM) chief executive officer and executive director Teng Chee Wai said.
He said the stage should be set for a weak US dollar to continue into next year, although he believes the Malaysian economy will be able to withstand external shocks including a recession in the US.
In a statement, Teng said the recent financial crisis has the potential to be a blessing in disguise for Asia and may present an opportunity for the region to showcase its resilience.
A dampened US economic outlook should increase the urgency within Asia to step up efforts to shift its growth dependency away from external demand, and to steer fiscal/monetary policies towards boosting demand.
This process should be facilitated by orderly adjustments in their undervalued currencies, stronger balance of payments and improved international liquidity positions.
"With the US consumer encumbered by mortgage financing woes, the rise of the Asian consumer should attract the attention of foreign investors. At the country level, it is the countries where domestic demand has been strongest - such as Singapore and Malaysia - where there has been the largest disconnect between the earnings cycle and the US economic cycle," he said.
HwangDBS IM recently launched its first performance-based fund, the HwangDBS Ascendur RIS 1 (HARIS1).
Targeted at the mass affluent, the unique features of the fund are the lower sales charge or front-end fees of a maximum charge of two per cent as opposed to the four to six per cent characteristic of equity unit trust funds, as well as the performance attribute which allows the manager to levy a performance fee if HARIS1 exceeds the pre-determined minimum return benchmark at eight per cent per annum.
The launch of HARIS1 represents HwangDBS IM's eighth fund for 2007.
Teng said the unique features challenge market convention but are necessary in the increasingly competitive marketplace.
"Managing absolute return mandates or funds is nothing new to HwangDBS IM. When we started out in 2001, it was a surprise to the industry when we set an absolute performance benchmark and included a fee on the performance as an incentive for the manager, in the event of positive performance.
"Since then, such features have become more common but somewhat limited to the management of discretionary mandates. Our main objective in bringing such a fund to the local market is to plug the gap between the mass retail and such services by introducing a product targeted specifically at the mass affluent but with elements of a discretionary mandate.
"At the same time we aim to ensure that investors are able to potentially reap more meaningful returns because of the lower fees," Teng said.
HARIS1 will primarily invest in equity securities of developed and emerging markets globally. It may also invest in fixed income securities of developed markets or debt instruments.
HARIS1 has an approved size of 200 million units priced at RM0.50 per unit. The minimum initial investment sum is set at RM500,000 and the minimum additional investment is RM100,000.
HARIS1 is a mixed securities and growth type fund targeted at medium to long-term investors who are risk tolerant and are seeking higher capital returns on their investments.
