Invesco on steady path long term
Alfred Ho, a fund manager of a 10-year award winner, warns retail punters pumping up Asian technology stock prices that they could be heading for a heavy fall.
The chief investment officer for Invesco Asia said discipline was the key to his Invesco GT Asia Enterprise Fund coming out on top over the marathon distance in the Asia ex-Japan category.
That has seen Mr Ho sticking to his investment principles even when retail punters were dumping their shares in black periods and rushing into the market in times of euphoria.
'As a house here we are managing a fair amount of assets. If we have to chase together with the man in the street then I can tell you my value-added is very minimal,' he said.
'We have to have a contrarian bias, there is no chasing our tail. That's one of the reasons we have been able to maintain a steady track record.' Mr Ho has trimmed back his holdings in technology names such as Korea Telecom and Richard Li Tzar-kai's Internet vehicle, Pacific Century CyberWorks, after seeing their prices soar in the rush for technology and telecom stocks.
'I have had more of a balanced portfolio since October last year,' he said.
Price-versus-earnings graphs with curves rising at 80 degrees for some Asian technology stocks are a stark warning of a dangerous consensus forming. When everybody has piled into a stock there can be an equally mad dash for the exit.
'Personally, I still think there is a lot of risk at this stage for people to turn completely momentum driven,' Mr Ho said. 'Everybody is going for the last dance. It is all money going into one very narrow sector. The higher it goes, the sharper the correction is going to be.
'If you look at Microsoft, it is the best technology company in the world. If you monitor the share price of Microsoft, it has never gone up to the extent of a lot of the tech stocks in this part of the world in such a short period. And you have to convince me that some of these companies are better than Microsoft.' As a reminder to stand back from the crowd, Mr Ho keeps pinned to his wall a newspaper clipping about the scramble in 1996 to get IPO shares of red chip, Beijing Enterprises Holdings.
'I thought, 'Is this consensus or what?' Then finally the red-chip bubble burst,' he said. 'Asia is about consensus, from consensus to confusion [then back] into consensus. That's a typical cycle. Now there is consensus on tech, I'm sure if something bad happens there will be absolute confusion.' Other winners of 10-year awards are JF Pacific Securities for the Asia including Japan category, Baring European Growth for European equities excluding Britain, HSBC GIF Hong Kong Equity for the Hong Kong equity category, GAM Japan and Invesco GT Investment for the global equity category.
BEST GROUP: 10 YEARS
