CIMB-Principal looks to Greater China

Schroders to sub-advise on offshore equity fund launched for Malaysian retailers.
MalaysiaÆs CIMB-Principal Asset Management has maintained the fund launch momentum as the first half of the year closes, now giving domestic investors greater exposure to Greater China. The CIMB-Principal Greater China Equity Fund was launched earlier this week and taps into the growing demand from Malaysian retail investors for offshore products, comprising of a basket of China, Hong Kong, Taiwan and Singapore equity.

Feeding into the Schroder ISF Greater China Fund, the current split of the fund is skewed towards the growth of China. This part comprises of 43% of the portfolio and will include stocks from sectors like telecommunication and shipbuilding. Approximately 27% of the portfolio is invested into Taiwan, with a heavy weighting on blue chip firms such as Taiwan Semiconductor Manufacturing Corporation (TSMC) and telcos. Roughly 18% of the fund is invested in Hong Kong, while a 2% portion comes from Singaporean firms invested into the Greater China region.

According to CIMB-Principal, the decision to launch the fund is multi-pronged. Firstly, the 23.5% annual return over the last five years from the Schroder ISF Greater China Fund was a catalyst to launch the fund to Malaysian investors. Secondly, the continued growth of ChinaÆs economy and the strong performances of sectors like Taiwan telecommunication and Hong Kong financials led the firm to launch this fund.

Malaysian investors can buy into the CIMB-Principal Greater China Equity Fund with a minimum investment of RM1,000 plus annual management fee of 1.8% through its distribution partners CIMB Bank, CIMB Wealth Management, Citibank, Hong Leong Bank and Standard Chartered. The fund size starts is capped at 300 million units, which is equivalent to RM 150 million ($43.5 million) and is until 2 July.

The latest offering from CIMB-Principal follows an extremely active period where the firm has been launching an array of offshore and sharia-compliant funds to Malaysian retail investors. Thus far in 2007, the Kuala Lumpur-based firm has rolled out its first Islamic structured fund and a global income fund. It plans to continue launching more offshore and Islamic funds in 2007, which will probably number around 12.

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