Conservatism, flexibility and an interest in new financial instruments are the key investment strategies of Tachaphol Kanjanakul, 48, a senior executive vice president for financial mangement at the Government Savings Banks, who has been tipped as the new secretary-general of the Government Pension Fund (GPF).
His name has emerged as one of the candidates for the GPF's top job, to replace Visit Tantisunthorn, who was fired in June amid allegations of management irregularities.
The GPF board is expected to chosse a new chief for the fund at its meeting this month.
Tachaphol said he had three key strategies in managing his own portfolio or personal savings.
First, he must be concervative. However, that does not mean he will be too conservative to dare invest in new things. Rather, he will be very prudent and careful, he said.
Second, investment must be flexible and adjustable, in line with changing situations, so as to proteet his portfolio from the impacts of market volatility.
Finally, he said he was ready to study new financial investments and new forms of investment, in order to create good returns for his personal portfolio. However, there had to be good reasons for such investments.
Tachaphol's duties at GSB will include managing the state bank's portfolio and setting long-term investment strategy. He has also set up a virtual protfolio that he uses as a model for both GSB's asset management and managing his own porfolio.
Tachaphol said his personal investments were mostly in mutual funds, both equity and fixed income, which were managed by other fund managers. He also invests in long-term equity funds and retirement mutual funds, because of tax incentives.
"I invested in the funds of several asset-management firms, in order to diversify risk. I also allocate assets in a variety of investment channels, to diversify risk. Aside from mutual funds and stocks, I also invest in property, particularly condominium units for resale or rent. The return is quite good, if you choose a good location," he said.
Tachaphol said that in selecting asset-management companies, he looked at their track record and, most importantly, the expertise of their fund managers. He studies the performance of each company before making an investment. However, he believes past performance does not guarantee continuing outstanding performance, because the investment enviroment is changing all the time.
He said investors shoudl study each mutual fund in detail, particularly equity funds.
Personally, Tachaphol said he liked equity funds that invested long term in good fundamental stocks. He does not like funds that invest in smaller stocks, because prices are quite volatile and risky.
When it comes to condominiums, Tachaphol said he had invested in some projects for both resale and rent, particularly projects close to Skytrain stations. Importantly, the projects must be managed by the top four developers.
"If we get a [commdominium in a] good location with good quality, foreign tenants won't ask for bargain prices. So I believe investing in condminiums is worth it," he said.
Tachaphol is now planning new investments in property funds. He prefers to invest in freehold property funds, where investors own the assets, rather than leasehold property funds. Ultimately, freehold funds have the opportunity for returns from the sale of assets at the end of a project, he said.
Monday, August 31, 2009
Thursday, August 27, 2009
FUND MANAGERS UNFAZED BY RED'S RALLY
Fund managers believe the red-shirt protest this weekend will be peaceful and not have a negative impact on the stock market, and that Asian stock markets are promising for investors. Vana Bulboon, CEO of UOB Asset Management, said the current global economic recovery would positively impact the Asian market. Financial institutions in Asia have been least affected by the global financial crisis, and so the Asian economy will turn around the soonest.
He believes the political situation in Thailand as well as the redshirt protest due on Sunday will not lead to further violence, and that foreign investors can be expected to understand the situation very well.
"There has been a problem for a long time in Thai politics, and foreigners already know about this. But once the situation settles well, I believe foreign investors will invest more in the Thai market," Vana said.
Jotika Savanananda, president of SCB Asset Management, also believes the red shirts' demonstration will not lead to any violence or affect economic activity. The country's political problems have built up over a long time and are well understood by foreign investors, she said.
"I believe the redshirt protest won't affect investment in the capital market right now," Jotika said.
She added that the local stock market was currently strong enough, with Thai economic indicators showing signs of recovery in line with a global recovery.
She said the economy next year is expected to record positive growth. The Bank of Thailand yesterday forecast grossdomesticproduct growth for 2010 at 4.55 per cent.
Meanwhile, UOB Asset Management recently launched the UOB Smart Asia Recovery fund, with the main focus in bigcap stocks in Asia. It invests 37.5 per cent in China, 25 per cent in Singapore, 18.75 per cent in Hong Kong, 12.5 per cent in Taiwan and 6.25 per cent in Thailand.
The SCB Asian Emerging Market Fund has invested in Asian stock markets, with emerging markets so far generating satisfactory results - and a high investment proportion in Thailand.
The returns in the three and sixmonth periods to August 25 were 16.36 per cent and 69.28 per cent, respectively. The net asset value was at Bt6.8052 per unit as of August 25.
He believes the political situation in Thailand as well as the redshirt protest due on Sunday will not lead to further violence, and that foreign investors can be expected to understand the situation very well.
"There has been a problem for a long time in Thai politics, and foreigners already know about this. But once the situation settles well, I believe foreign investors will invest more in the Thai market," Vana said.
Jotika Savanananda, president of SCB Asset Management, also believes the red shirts' demonstration will not lead to any violence or affect economic activity. The country's political problems have built up over a long time and are well understood by foreign investors, she said.
"I believe the redshirt protest won't affect investment in the capital market right now," Jotika said.
She added that the local stock market was currently strong enough, with Thai economic indicators showing signs of recovery in line with a global recovery.
She said the economy next year is expected to record positive growth. The Bank of Thailand yesterday forecast grossdomesticproduct growth for 2010 at 4.55 per cent.
Meanwhile, UOB Asset Management recently launched the UOB Smart Asia Recovery fund, with the main focus in bigcap stocks in Asia. It invests 37.5 per cent in China, 25 per cent in Singapore, 18.75 per cent in Hong Kong, 12.5 per cent in Taiwan and 6.25 per cent in Thailand.
The SCB Asian Emerging Market Fund has invested in Asian stock markets, with emerging markets so far generating satisfactory results - and a high investment proportion in Thailand.
The returns in the three and sixmonth periods to August 25 were 16.36 per cent and 69.28 per cent, respectively. The net asset value was at Bt6.8052 per unit as of August 25.
SEC puts Maris on probation
The Securities and Exchange Commission has put Maris Tarab, managing director of ING Funds, on a three-year probation following his failure to protect the interest of TU Dome Residential Complex Property Fund (TU-PF) unit holders.
Maris was also fined Bt231,750, while ING Funds had to pay a penalty of Bt1.9 million. Siam City Bank, as the fund's trustee, was fined Bt421,650.
The SEC statement said it had discovered that the three parties had failed to perform their duty of making unit holders' benefits their top priority.
TU-PF had declared that it was going to invest in a building on a land plot that had a 30-year lease in one individual's name. However, it turned out that several other people also owned the plot.
Despite knowing about the land's joint ownership, Maris had the fund pay Bt173.5 million to the lessee and the contractor without seeking approval from the unit holders.
This action faces the risk of being opposed by the joint owners, which in turn could hurt the unit holders.
He also had the fund pay leasing fees worth Bt808.4 million before the long-term lease was signed.
In 2008, Maris and ING Funds tried to solve the problem. The lessee became the plot's single owner when the 30-year lease was signed.
The company also waived its management fee for five months and reduced it by half to 0.25 per cent of net asset value for 31 months.
Maris was also fined Bt231,750, while ING Funds had to pay a penalty of Bt1.9 million. Siam City Bank, as the fund's trustee, was fined Bt421,650.
The SEC statement said it had discovered that the three parties had failed to perform their duty of making unit holders' benefits their top priority.
TU-PF had declared that it was going to invest in a building on a land plot that had a 30-year lease in one individual's name. However, it turned out that several other people also owned the plot.
Despite knowing about the land's joint ownership, Maris had the fund pay Bt173.5 million to the lessee and the contractor without seeking approval from the unit holders.
This action faces the risk of being opposed by the joint owners, which in turn could hurt the unit holders.
He also had the fund pay leasing fees worth Bt808.4 million before the long-term lease was signed.
In 2008, Maris and ING Funds tried to solve the problem. The lessee became the plot's single owner when the 30-year lease was signed.
The company also waived its management fee for five months and reduced it by half to 0.25 per cent of net asset value for 31 months.
Temasek says not put off by bank losses
Singapore investment firm Temasek Holdings said yesterday that it had not been put off investing in Western financial institutions despite suffering massive losses from the global financial crisis.
Ho Ching, chief executive of the state-linked firm, said it would invest in in such banks "if the opportunitites look attractive".
Temasek suffered massive losses after pumping billions into Western financial companies that were in need of a capital injection as the economic crisis unfolded.
It took a stake in Wall Street icon Merrill Lynch but when the US firm was bought by Bank of America, Temsek divested its interest. It also bought into British lender Barclays but later also offoaded that stake.
It is estimated Temasek lost more than US$5.4 billion (Bt184.4 billion) from the sale of its holdings in the two banks, Dow Jones Newswires quoted sources as saying.
Temasek made its divestments just before the global markets maade a recovery at the start of the year.
Ho, the wife of Prime Minister Lee Hsien Loong, said last month that by theh end of March Temasek's portfolio had lost more than (Bt946.9 billion) compared with a year ago.
Ho Ching, chief executive of the state-linked firm, said it would invest in in such banks "if the opportunitites look attractive".
Temasek suffered massive losses after pumping billions into Western financial companies that were in need of a capital injection as the economic crisis unfolded.
It took a stake in Wall Street icon Merrill Lynch but when the US firm was bought by Bank of America, Temsek divested its interest. It also bought into British lender Barclays but later also offoaded that stake.
It is estimated Temasek lost more than US$5.4 billion (Bt184.4 billion) from the sale of its holdings in the two banks, Dow Jones Newswires quoted sources as saying.
Temasek made its divestments just before the global markets maade a recovery at the start of the year.
Ho, the wife of Prime Minister Lee Hsien Loong, said last month that by theh end of March Temasek's portfolio had lost more than (Bt946.9 billion) compared with a year ago.
Temasek issues new charter
The Singapore state investor Temasek Holdings Pte downplayed its links to government policy or strategic interests in a revised charter issued yesterday, as it eyes more overseas assets from banks to infrastructure.
Temasek, one of the world's biggest wealth funds whose sole shareholder is the Singapore government, still has controlling stakes in half the city-state's blue-chip firms such as Singapore Airlines, but it has increased its exposure elsewhere.
Chief executive Ho Ching said Temasek would still consider taking stakes in Western financials, despite the firm's estimated $4 billion-plus losses after it sold off its stakes in Bank of America and Barclays in the past year.
"If the opportunity comes, and it looks attractive, yes," Ho said, adding that the fund was also interested in resources as an asset class and saw opportunities in Asian infrastructure.
She, however, ruled out investing in overseas land for agriculture, as firms linked to South Korea and Middle Eastern firms have done in recent years.
Ho was speaking at the launch of an updated charter that described the fund as an investment firm managed on commercial principles, dropping a reference to its role to improve the city-state's economic base.
"Temasek felt the need to emphasise its independence, or perhaps it is prepar-ing to spin itself off as a truly independent unit.... Countries are resistant to investments by politically-linked entities," said David Cohen, director of Asian economic forecasting at Action Economics.
China Investment Corp (CIC), the $200 billion sovereign fund, has repeatedly assured Western nations and investors that it will become more transparent in its operations and investments amid growing concerns about Beijing's political motives, and last month published its first annual results report.
The role of wealth funds around the world, which oversee about $3 trillion in assets, changed from a key source of capital for struggling Western banks early in the crisis, to governments redeploying funds to stabilise their home markets this year.
State Street Global Advisors, one of the world's biggest institutional investors, told Reuters this week such measures would now ease and funds would resume investments for returns.
Temasek, which has published annual reports since 2004, now describes itself as an investment firm creating longterm value for its shareholder, after being set up in 1974 to hold investments in state firms.
The updated charter does not include the notes accompanying the first 2002 version stating the government through Temasek - needed to own and control firms deemed critical to the city-state's security, economic wellbeing or public policy.
"There are very few of these companies left in our stable," said Ho, the wife of Singapore Prime Minister Lee Hsien Loong."We are an investor that is prepared to invest and divest."
She said initial public offerings of unlisted units, which include firms in strategic sectors such as port operator PSA, grid operator Singapore Power,and television and radio broadcaster Mediacorp, were "still on the table."
"There is a right time for them to be listed," Ho said, adding that initial public offerings for asset manager Fullerton Fund Management and bank holding company Fullerton Financial Holdings "are also long-term possibilities."
She also said Temasek could package its private equity investments in infrastructure into business trusts in the next 3-5 years to raise funds as well as to make such assets available to retail investors in Singapore.
The updated charter does continue to show Temasek's links to the government. For example, the Singapore president's approval is required for the appointment or removal of Temasek's CEO.
Temasek will release its annual report next month, giving the audited value of its portfolio and investment returns.
Temasek, one of the world's biggest wealth funds whose sole shareholder is the Singapore government, still has controlling stakes in half the city-state's blue-chip firms such as Singapore Airlines, but it has increased its exposure elsewhere.
Chief executive Ho Ching said Temasek would still consider taking stakes in Western financials, despite the firm's estimated $4 billion-plus losses after it sold off its stakes in Bank of America and Barclays in the past year.
"If the opportunity comes, and it looks attractive, yes," Ho said, adding that the fund was also interested in resources as an asset class and saw opportunities in Asian infrastructure.
She, however, ruled out investing in overseas land for agriculture, as firms linked to South Korea and Middle Eastern firms have done in recent years.
Ho was speaking at the launch of an updated charter that described the fund as an investment firm managed on commercial principles, dropping a reference to its role to improve the city-state's economic base.
"Temasek felt the need to emphasise its independence, or perhaps it is prepar-ing to spin itself off as a truly independent unit.... Countries are resistant to investments by politically-linked entities," said David Cohen, director of Asian economic forecasting at Action Economics.
China Investment Corp (CIC), the $200 billion sovereign fund, has repeatedly assured Western nations and investors that it will become more transparent in its operations and investments amid growing concerns about Beijing's political motives, and last month published its first annual results report.
The role of wealth funds around the world, which oversee about $3 trillion in assets, changed from a key source of capital for struggling Western banks early in the crisis, to governments redeploying funds to stabilise their home markets this year.
State Street Global Advisors, one of the world's biggest institutional investors, told Reuters this week such measures would now ease and funds would resume investments for returns.
Temasek, which has published annual reports since 2004, now describes itself as an investment firm creating longterm value for its shareholder, after being set up in 1974 to hold investments in state firms.
The updated charter does not include the notes accompanying the first 2002 version stating the government through Temasek - needed to own and control firms deemed critical to the city-state's security, economic wellbeing or public policy.
"There are very few of these companies left in our stable," said Ho, the wife of Singapore Prime Minister Lee Hsien Loong."We are an investor that is prepared to invest and divest."
She said initial public offerings of unlisted units, which include firms in strategic sectors such as port operator PSA, grid operator Singapore Power,and television and radio broadcaster Mediacorp, were "still on the table."
"There is a right time for them to be listed," Ho said, adding that initial public offerings for asset manager Fullerton Fund Management and bank holding company Fullerton Financial Holdings "are also long-term possibilities."
She also said Temasek could package its private equity investments in infrastructure into business trusts in the next 3-5 years to raise funds as well as to make such assets available to retail investors in Singapore.
The updated charter does continue to show Temasek's links to the government. For example, the Singapore president's approval is required for the appointment or removal of Temasek's CEO.
Temasek will release its annual report next month, giving the audited value of its portfolio and investment returns.
Thai firms to boost dollar bond sales
Thai companies will increase sales of dollar bonds as limited investor demand for baht securities forces them to seek funding elsewhere, according to Standard Chartered Plc.
"Thai companies are at a crossroads right now," said Ratch Sodsatit, executive vice-president and capital markets head of the London-based bank's Thai unit."Domestic liquidity is not strong enough for them and tapping the dollar market in a big way will be key to solving that."
Thai companies have sold 288.7 billion baht ($8.5 billion) worth of local currency notes this year, passing the 270.3 billion they raised in all of 2008,according to data compiled by Bloomberg. Sales rose as lending by Krung Thai Bank, Siam Commercial Bank and nine other Thai banks shrank 3.2%,driven by a reduction in loans to companies and small businesses, Citigroup said in a note on Aug 20.
Petroliam Nasional Bhd, the Malaysian state-owned oil company known as Petronas, sold $4.5 billion worth of bonds on Aug 6 in the biggest dollar issue by an Asian company outside Japan this year, Bloomberg data show.PTT Plc, Thailand's biggest energy company, is in talks with banks for a sale that may be of similar size, said Mr Ratch.
PTT is well-placed and highly likely to tap the dollar-bond market because it is a long-dated issuer and, in many cases, the limit in terms of the percentage local investors can hold of them has been reached, he said.
"Thai institutional investors are buying only the safest debt, making the dollar bond market increasingly important for riskier borrowers," he added.
"The market has shifted over the past year and mutual funds are staying away from anything rated less than A-minus."
Individual investors, jaded by bank deposit rates as low as 0.8%, are the most active buyers of corporate debt in Thailand, he said.
A ranking of A- is the seventh-highest investment grade from Standard &Poor's, the New York-based ratings company.
Easy Buy Plc, the consumer finance company controlled by Japan's Acom Co, sold 3.5 billion baht worth of threeyear notes on July 24, paying a 4.9%coupon. The securities were priced to yield 250 basis points more than benchmark rates and 95% of the offer was taken up by individuals, said Mr Ratch.
Standard Chartered Bank (Thai) is ranked seventh among Thai corporate bond sales this year with a market share of 4.3%, Bloomberg data show.
"Thai companies are at a crossroads right now," said Ratch Sodsatit, executive vice-president and capital markets head of the London-based bank's Thai unit."Domestic liquidity is not strong enough for them and tapping the dollar market in a big way will be key to solving that."
Thai companies have sold 288.7 billion baht ($8.5 billion) worth of local currency notes this year, passing the 270.3 billion they raised in all of 2008,according to data compiled by Bloomberg. Sales rose as lending by Krung Thai Bank, Siam Commercial Bank and nine other Thai banks shrank 3.2%,driven by a reduction in loans to companies and small businesses, Citigroup said in a note on Aug 20.
Petroliam Nasional Bhd, the Malaysian state-owned oil company known as Petronas, sold $4.5 billion worth of bonds on Aug 6 in the biggest dollar issue by an Asian company outside Japan this year, Bloomberg data show.PTT Plc, Thailand's biggest energy company, is in talks with banks for a sale that may be of similar size, said Mr Ratch.
PTT is well-placed and highly likely to tap the dollar-bond market because it is a long-dated issuer and, in many cases, the limit in terms of the percentage local investors can hold of them has been reached, he said.
"Thai institutional investors are buying only the safest debt, making the dollar bond market increasingly important for riskier borrowers," he added.
"The market has shifted over the past year and mutual funds are staying away from anything rated less than A-minus."
Individual investors, jaded by bank deposit rates as low as 0.8%, are the most active buyers of corporate debt in Thailand, he said.
A ranking of A- is the seventh-highest investment grade from Standard &Poor's, the New York-based ratings company.
Easy Buy Plc, the consumer finance company controlled by Japan's Acom Co, sold 3.5 billion baht worth of threeyear notes on July 24, paying a 4.9%coupon. The securities were priced to yield 250 basis points more than benchmark rates and 95% of the offer was taken up by individuals, said Mr Ratch.
Standard Chartered Bank (Thai) is ranked seventh among Thai corporate bond sales this year with a market share of 4.3%, Bloomberg data show.
Subscribe to:
Posts (Atom)