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.
“ASEAN market drawdown since January provides buffer against adverse global macro events” Market Review and Outlook: ASEAN markets struggled again from liquidity tightening caused by adverse global macro: higher interest rates and US dollar appreciation compounded by US trade protectionism and risk of Italexit to Eurozone unity. Global macro overshadowed positive developments within ASEAN, namely Indonesia market outperformance and signs the market has bottomed. Indonesia had in the prior three months suffered the biggest market drawdown in ASEAN as the rupiah currency depreciated to historical lows and capital outflow reached historical highs. ASEAN markets are better positioned to weather adverse global macro as it has already endured a decline of more than 10% since January 2018 and capital outflow is near historical highs. Return of market stability would be supported by accommodative monetary policy with Fed tolerance for higher inflation and the likelihood rate hikes will not exceed 1% point in 2018. Portfolio Strategy: Fund outperformance was achieved by raising Indonesia from underweight to overweight. Indonesia was upgraded as capital markets have already priced-in liquidity tightening caused by USD appreciation and higher bond yields. The stock market should have already bottomed as US tolerance for higher inflation implies gradual rate hikes and Indonesia's new policy priority is to stabilize capital markets. Domestic cyclicals such as banks and consumer discretionary stocks are expected to outperform. Malaysia's underweight was increased further. The opposition unexpectedly won the general election which creates a period of uncertainty as it undoes policies from the previous administration. Construction stocks were sold as infrastructure projects are likely to be deferred or cancelled
Share class (A-USD)
(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.