KUALA LUMPUR: RHB Asset Management Sdn Bhd expects its newly-launched equity and growth fund dubbed the “RHB-OSK Entrepreneur Fund” to garner between 10% and 15% in investment returns over the next two to three years.
Chief executive officer (CEO) and regional head of group retail distribution Ho Seng Yee said the company expects to raise RM200 million over the next 12 months through the fund.
The fund was launched in partnership with Tokio Marine Asset Management International Pte Ltd, which is the investment adviser. Its portfolio will initially consist of between 70% and 80% of investments in Japanese equity, targeted at the securities of companies that possess entrepreneurial characteristics.
Some of the companies which could be included in the fund’s portfolio are Nitori Co Ltd, a furniture manufacturer, HIS Co Ltd, a travel agency, and Don Quijote Holdings Co Ltd, a discount store chain. The remainder of the equity investments will come from other Asian countries, such as Hong Kong, China, Thailand, Singapore and Malaysia.
RHB Asset Management chief investment officer Hoe Cheah How said entrepreneurial companies had been chosen due to their resilience to economic cycles.
“We found that those companies weathered the global financial crisis well, and have a track record in recovering from it. The share price performance of these companies has also significantly outperformed all the companies included in the MSCI Asia Pacific Index,” he told reporters after the launch of the RHB-OSK Entrepreneur Fund yesterday.
Hoe said the reason why the fund will focus its investments in Japan first is due to the country’s recovering economy.
“[Japan Prime Minister] Shinzo Abe has laid down three important structural policy shifts for Japan, namely an aggressive monetary policy, a flexible fiscal policy and a three-pronged growth strategy.
“Since the appointment of Abe towards the end of 2012, the economic performance of the Japanese market has been on the uptrend,” he added.
The RHB-OSK Entrepreneur Fund will invest between 70% and 98% of its net asset value (NAV) in company securities listed in Japan and other Asian markets, while the remaining 2% and 5% of NAV will be invested in liquid assets, including money market instruments and deposits.
The fund was offered for subscription last Tuesday, with a minimum investment of RM1,000 with each unit costing 50 sen apiece, during the initial offer period until Nov 3. Moving forward, the fund could be introduced in Singapore and Hong Kong.
On the proposed merger involving RHB Capital Bhd, CIMB Group Holdings Bhd and Malaysia Building Society Bhd, a RHB Group spokesman said the bank is focused on taking the terms of their merger proposal through the approval process, but did not elaborate.
This article first appeared in The Edge Financial Daily, on October 24, 2014.