JF reveals funds plan for tapping emerging markets
JARDINE Fleming Unit Trusts yesterday mapped out its strategy for tapping nascent investment opportunities across the globe with the launch of the first of three emerging markets funds.
The Jardine Fleming Asian Emerging Markets Trust will give investors access to Asian markets which are on the verge of rapid economic growth.
The fund will focus initially on investment opportunities in Indonesia, Thailand, India, Pakistan, Sri Lanka, Malaysia, China and the Philippines. Investments might also be made in Vietnam and Burma.
The managing director of Jardine Fleming Investment Management, Robert Thomas, said the Asian fund would be joined later by an emerging markets fund focusing on Latin America and then by a European fund.
'An umbrella formation will ultimately be established over the three funds,' Mr Thomas said.
Economies that fall into the emerging markets category generally belong to poor countries that have the potential for, or are already enjoying, rapid growth.
Asia's emerging economies, with their large populations and developing capital markets, are tipped to be among the fastest-growing in the world.
With three specialised funds, Jardine Fleming aims to have specific geographical research and market knowledge.
Managed by Roger Ellis, who also runs Jardine Fleming's Eastern and Thailand Funds, the new Asian fund will aim for investments which give optimum returns with the minimum of risk.
Investment decisions will draw heavily on the resources already used by Jardine Fleming's Hong Kong head office as part of its long-term strategy for the region.
'We already have established research teams in our regional offices and they will be important building blocks for our business development in emerging markets,' Mr Thomas said.
However, he said that Hong Kong would remain the headquarters for all JF operations.
Although the returns are potentially more lucrative, emerging markets funds are more volatile and have higher risk profiles than funds investing in developed markets.
Despite this, early players are expected to benefit from undervalued stocks that analysts predict will produce superior long-term returns. 'It is much better to invest in emerging markets before they open,' Mr Thomas said.
'Jardine Fleming already has regional experience, not only as a fund manager, but also as a brokerage house and in corporate finance that will help it to run this emerging market fund.' During the two-week launch period which begins tomorrow, the fund will be offered at the fixed price of US$10.53 (about HK$81) per unit.
As with JF's other funds, there will have a minimum investment of US$2,000. Mr Thomas said investors should treat the new fund as a medium to long-term investment.