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Top performing funds of 1Q 2010 April 5, 2010
Malaysia market emerged as one of the outperformers amidst a volatile market in 1Q 2010. Here, we will take a closer look at the top gainers and losers during this period.
Author : David Koay


Untitled Document

Table 1: Top Performing Funds

Fund Name

Region/Asset Class

YTD Returns

InterPac Dana Safi

Malaysia Equities

12.64%

InterPac Dynamic Equity Fund

Malaysia Equities

10.96%

PRU Master Trust- Prudential Small-Cap

Malaysia Equities

10.89%

RHB GoldenLife 2030

Malaysia Balanced

9.37%

Alliance Vision Fund

Malaysia Equities

8.25%

Source: iFAST compilations, performance in the tables are in MYR terms (data as at 31 Mar 10), calculated using NAV prices, with any income or dividend reinvested.

The best performing funds were funds invested into Malaysia equities. This was in line with our top markets where Malaysia emerged as the third best equity market under our coverage after Indonesia and Thailand.  The top five funds are equity funds fully invested into Malaysian equities except for RHB GoldenLife 2030, the fourth best performing fund which is a Malaysia balanced fund. Interestingly, the performance of the top five funds significantly outperformed KLCI which rose by 3.9% only. InterPac Dana Safi emerged as the best performer in 1Q 2010 by rising 12.64%, followed by InterPac Dynamic Equity Fund and PRU Master Trust - Prudential Small Cap which delivered returns of 10.96% and 10.89% respectively.

Malaysia’s equity market remained resilient in 1Q2010 as the economic numbers released were largely positive with some exceeding expectations. Its 4Q 09 GDP growth released end of February 2010 surprised the market as it rebounded strongly to 4.5% which exceeded consensus forecast. In addition, the optimistic stance of the central bank towards Malaysian economy coupled with the unveiling of the New Economic Model (NEM) helped to shore up the market.

Table 2: Top Performing Bond Funds

Fund Name

Region/Asset Class

YTD Returns

RHB GoldenLife Today

Malaysia Bonds

2.37%

RHB Islamic Bond Fund

Malaysia Bonds

1.93%

AmDynamic Bond

Malaysia Bonds

1.76%

RHB Bond Fund

Malaysia Bonds

1.76%

Areca Enhanced Income Fund

Malaysia Bonds

1.21%

Source: iFAST compilations, performance in the tables are in MYR terms (data as at 31 Mar 10), calculated using NAV prices, with any income or dividend reinvested.

Bond funds performance remained modest with all Malaysia bond funds within our platform delivered positive returns from 0.18% to 2.37% in 1Q 10. Despite the earlier-than-expected Overnight Policy Rate (OPR) hike on 4th Mar 2010, Malaysia Government Securities (MGS) overall had an uptrend, bucking the downside risks from rate hikes. This was due to the relatively attractive yields of MGS at about 4% which remained attractive to investors coupled with the strengthening of the Ringgit. Consequently, investors remained net buyers in 1Q 10. RHB GoldenLife Today appeared as the winner among the bond funds by rising 2.37%, followed by RHB Islamic Bond Fund and AmDynamic Bond which increased 1.93% and 1.76% respectively.

Nonetheless, Alliance Global Bond Fund and RHB Asian Total Return Fund turned out to be the worst bond fund performers by shedding 4.24% and 3.30% respectively. The performance of the two funds was mainly affected by the strength of MYR over the first quarter of 2010. USD has depreciated 4.7% against MYR in the first quarter, mainly due to the rate hike taken by Bank Negara in early March. The upwards revision in the economic outlook for Malaysia also added strength to MYR against other currencies.

Table 3: Worst Performing Funds

Fund Name

Region/Asset Class

YTD Returns

TA European Equity Fund

European Equities

-6.50%

Pacific Focus China Fund

China Equities

-6.65%

AmPrecious Metals

Global Minerals Equities

-7.02%

OSK-UOB Asian Growth Opportunities Fund

Asia Ex Japan Small-Mid Cap Equities

-7.05%

Prudential Country Selection Fund

Global Equities

-7.16%

Source: iFAST compilations, performance in the tables are in MYR terms (data as at 31 Mar 10), calculated using NAV prices, with any income or dividend reinvested.

Most equity markets outside Malaysia had a weak performance for the quarter. As a result, the worst performing funds were equity funds invested into overseas equity markets. The worst performer was Prudential Country Selection Fund which dropped by 7.16%. The fund was invested into global equities. The second worst performer was OSK-UOB Asian Growth Opportunities Fund which declined by 7.05%, followed by AmPrecious Metals and Pacific Focus China Fund which declined by 7.02% and 6.65% respectively. TA European Equity Fund came as the fifth worst performer by decreasing 6.50%. Once again, the strength of MYR against currencies like USD and Euro has played a large part in the poor performance of all these equity funds.

China equities have been plagued by concerns over its exit strategies which could come earlier than expected, with speculation that rate hikes could happen as early as 2Q 10. Consequently, HSML100 Index (China Equity Index) dropped by 7% and partially dragged MSCI Asia ex Japan by 4.2%. On the other hand, European equities continued to be afflicted by sovereign debt concerns especially in countries like Greece, Portugal, Ireland, Italy and Spain, which caused DJ Stoxx 600 to drop by 7.0%. 

Going forward, we remain optimistic of the equity market and continue to overweight on equities in view of the economic growth and valuations which we consider attractive. Nonetheless, the pace of rally witnessed in 2009 is unlikely to repeat in 2010 as the market has priced in a reasonable dose of optimism.

 


This article is not to be construed as an offer or solicitation for the subscription, purchase or sale of any fund. No investment decision should be taken without first viewing a fund's prospectus and if necessary, consulting with financial or other professional advisers. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Past performance and any forecast is not necessarily indicative of the future or likely performance of the fund. The value of units and the income from them may fall as well as rise. Opinions expressed herein are subject to change without notice. Please read our disclaimer in the website.