The Sub-Fund's investment objective, over a recommended investment period of more than 5 years, is to grow net asset value by investing in companies registered predominantly in Asean Countries.
“Accumulate market corrections caused by fund outflow and volatile capital markets”Market Review and Outlook ASEAN markets were volatile for the second time this year caused by higher interest rates and liquidity tightening. US long-bond yields rose to 3% prompting a sell-off in capital markets and currency depreciation. Indonesia and Philippines capital markets once again bore the brunt of fund outflow. Similar to the US rate-driven drawdown in February 2018, market corrections are not expected to turn into a bear market. It is still too early to price-in the end of easy money and growth fundamentals should remain intact. However, the market's trend is likely to have shifted from upward to range-trade over the next few months as positive revisions and higher multiples are less likely under volatile capital markets. Market returns of 20% are still possible in 2018 but market timing and mean-reversion strategies need to be employed to accumulate 10% price corrections.Portfolio Strategy Fund underperformance was caused by overweighting technology stocks torpedoed by weaker earnings prospects and underweighting telecom stocks which recovered from oversold levels following earnings downgrades. Malaysia country weighting was tactically increased in anticipation of a favourable election result. General elections will take place on 9th May 2018 and stocks typically rise in the run-up to elections. Energy sector allocation was increased as high oil prices should sustain from OPEC production cuts and seasonal driving demand. Technology exposure was reduced on earnings risk inferred from weak results reported by multi-national customers. Transportation stocks such as container port operators were reduced on de-rating risk from US-China trade protectionism.
Share class (A-EUR)
(1) The rating grades the funds on a scale from 1 to 7. This rating system is based on the average fluctuations of the net asset value over the past five years. It corresponds to the variation range of the portfolio upwards and downwards. If the net asset value is less than 5 years old, the rating is determined by other regulatory calculation methods. Historical data such as those used to calculate the rating may not be a reliable indication of the future risk profile. The current category is neither a guarantee nor an objective. Category 1 does not signify a risk-free investment.