TheStar
KUALA LUMPUR: CIMB-Principal Asset Management Bhd expects unit trust fund size to grow to some RM8.5bil by year-end from RM7bil presently, said chief executive Noripah Kamso.
Besides the CIMB-Principal Steady Returns Bond Fund 3 that was launched Monday, the asset management company is expected to launch another four funds, two in Malaysia and two in Indonesia.
The four new funds were "highly likely" going to be offshore equity-based, Noripah said during the press conference after the launch.
The CIMB-Principal Steady Returns Bond Fund 3 is a closed-end fund with fund size of RM150mil.
Noripah said the newly launched fund, which would invest in both local and foreign sovereign bonds, was likely to generate a return of between 5% to 6% per annum.
Executive vice president and head of fixed income Nor Hanifah Hashim said the asset allocation could either take on a defensive (60:40 ratio), or base (50:50), or aggressive (40:60) approach, she said.
The selection criteria included minimum yield of 4% and minimum A rating by RAM or MARC for local bonds, and at least 5.5% yield and BB1- rating by foreign rating agency for foreign bonds, she added.
Nor Hanifah said the foreign bonds might include Australia, New Zealand, Vietnam, Hong Kong, Indonesia, the Philippines, Singapore, Thailand, South Korea, Taiwan and India.
Noripah said aside of the Asian exposure, the newly launched fund also provided lower risks and regular income bi-annually over the fund period, which were ideal for investors who were planning for children's tertiary education, holiday or retirement.
Furthermore, given that they were foreign sovereign bonds issued by the respective government, they were unlikely to be affected by sub-prime issue or credit crunch concern, she added.
The application fee is 1% of net asset value but a fee of up to 1.5% may be levied on any withdrawal made before the fund matures. The fund is open for investment until Nov 21.
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