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A new chart topper
November 12, 2012

A fund with an exposure to the ASEAN countries has posted impressive returns over the past year


Author : iFAST Content Team



 A new chart topper

A look at the current 1-year return of all funds throws up an interesting chart topper. JPMorgan JF ASEAN Equity Off-shore Fund is one of the best performers with a current return of 27.50%, way ahead of the Sensex or Nifty which both display single digit returns over the same time period.

JPMorgan JF ASEAN Equity Off-shore Fund is a feeder fund that invests in JPMorgan Funds - JF ASEAN Equity Fund. The fund invests in companies of countries which are part of the 10-member ASEAN bloc*. Though the universe gives the fund managers ample flexibility to span across countries, the bulk of the investments are in Singapore, Indonesia, Thailand and Malaysia (September 2012 portfolio).

It is ironical that the region mired in a financial crisis in 1997 has proved itself more resilient to the global gloom. Some media commentaries actually dub it as a safe haven in these tumultuous times. But behind the obvious need for public investment in infrastructure, the consumption theme and good demographics, the nations that comprise this 10-member bloc are a very diverse lot and no generalization is justified.

This fund follows a bottom-up stock picking strategy by first looking at the economic view on a country before scouting for individual stocks. The portfolio is well diversified with the top 10 holdings comprising 30% of the portfolio. The sector exposure is just a reflection of this process and has stayed constant over the past few months (Financials, Industrials, Consumer Discretionary).

This fund has the capability of providing a diversified tilt to your portfolio. But, on a closing note, do remember that there is the currency risk to contend with when investing in international funds. Though your investment is in rupee terms, it would have been converted into foreign currency. It will then need to be re-converted into rupees when you sell your units. If the rupee appreciates when you do so, you would lose out. Over the long term, if the fund continues to deliver well, that negative impact would be nullified to some extent.

* Association of South East Asian Nations (ASEAN): The Philippines, Indonesia, Thailand, Malaysia, Vietnam, Singapore, Brunei, Cambodia, Laos and Myanmar

 

Disclaimer: iFAST and/or its content and research team’s licensed representatives may own or have positions in the mutual funds of any of the Asset Management Company mentioned or referred to in the article, and may from time to time add or dispose of, or be materially interested in any such. This article is not to be construed as an offer or solicitation for the subscription, purchase or sale of any mutual fund. No investment decision should be taken without first viewing a mutual fund's scheme information document including statement of additional information. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Investors should seek for professional investment, tax, and legal advice before making an investment or any other decision. Past performance and any forecast is not necessarily indicative of the future or likely performance of the mutual fund. The value of mutual funds and the income from them may fall as well as rise. Opinions expressed herein are subject to change without notice. Please read our disclaimer on the website.Please read our disclaimer in the website. Risk Factors: Mutual funds, like securities investments, are subject to market risks and there is no guarantee against loss in the Scheme or that the Scheme’s objectives will be achieved. As with any investment in securities, the NAV of the Units issued under the Scheme can go up or down depending on various factors and forces affecting capital markets. Past performance of the Sponsor/the AMC/the Mutual Fund does not indicate the future performance of the Scheme. The name of the Scheme does not in any manner indicate the quality of the Scheme, its future prospects or returns. Please read the Statement of Additional Information and Scheme Information Document carefully before investing.



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