KUALA LUMPUR (Jan 23): TA Investment Management Bhd (TAIM) has launched TA Rainbow Income Fund, a new close-ended fund investing in fixed income instruments and structured warrants to provide potential annual returns.

The new fund is an exclusive partnership with OCBC Bank and will only be distributed by OCBC Bank.

TAIM chief executive officer Wong Mien said in a statement today that the fund is specifically designed to cater to current volatile and uncertain market and aims to provide income whilst preserving capital on maturity date.

"During uncertain market direction, diversified investment is one of the most common strategies used. However, the most common strategy performance will only be average of the portfolio's underlying assets. On top of that, the return of the best performance underlying assets will be dragged down by the lower performing underlying assets in the portfolio," Wong said.

In contrast, the key feature of the TA Rainbow Income Fund, Wong said, is its dynamic performance-based allocation strategy.

The fund is linked to the performance of the three award winning underlying assets allocated in the fund. And based on actual performance of the underlying assets, the unique strategy will automatically allocate higher weightage (%) to the best performing underlying assets.

"That is, the fund will be allocating 45% weightage to the best performing underlying assets, followed by 30% weightage to the second-best performing underlying assets and the remaining 25% weightage to the third-best performing underlying assets. We foresee that this strategy will enhance the total return of the diversified portfolio allocation and will far outweigh the equal weightage's average return," said Wong.

"We foresee that this strategy will enhance the total return of the diversified portfolio allocation and will far outweigh the equal weightage's average return," he said.

In a separate statement, OCBC Bank head of consumer financial services Lim Wyson said the introduction of the product is timely in light of the growing quest to preserve investments while attempting to grow them.

"We have seen growing investor concerns about the effects of market volatility on their investments. So, it has naturally become more pressing now than ever before to seek out alternative options to enable our customers to continue riding on the growth opportunities out there whilst ensuring optimal portfolio allocation and investment capital preservation.

"We believe that the hybrid nature of the product will be well received by our customers. With an investment outlay of RM1,000 upwards they can access the benefits of the product," Lim said.