UOBAM changes focus to advise on portfolio
WITH THE ongoing trading volatility in the equity market, United Overseas Bank Group in Singapore has told its subsidiaries, including UOB Asset Management (Thailand), to focus on advising customers to hold an efficient portfolio that suits their risk app
The group will announce its operating results for 2015 and its business targets for this year soon, but the new policy direction means the local unit cannot provide an actual business target for Thailand.
However, Vana Bulbol, chief executive officer of UOB Asset Management (Thailand) – UOBAM – said that under the group’s policy, the company’s AUM in each fund category this year should grow in line with the market.
According to the Association of Investment Management Companies, overall mutual-fund AUM in the Kingdom last year grew by around 6 per cent, compared to an average annual growth rate of 14.28 per cent for the previous five years.
UOBAM’s AUM in this category grew by 7.6 per cent last year.
The association’s data show UOBAM with total AUM of Bt295.97 billion, of which Bt137.9 billion was in mutual funds, Bt89.4 billion in provident funds and Bt68.66 billion in private funds.
Vana said that negative news – including the yuan devaluation, the US Federal Reserve’s interest-rate hike and the plunge in oil prices – had made investors tone down their investment in mutual funds.
However, market volatility last year encouraged investors to diversify investment in the offshore market, resulting in inflows of foreign investment funds at UOBAM reaching more than Bt50 billion, representing growth of 34.23 per cent compared to the year before.
The company believes that the overall mutual-fund market in Thailand this year could grow by 12-14 per cent because of the bright prospects in advanced markets, he added.
UOBAM, acknowledging the impact of group policy divergence on investment, is advising investors to continue to put money in funds that invest in equities in the European Union, Japan and the healthcare sector, the CEO said.
Chief marketing officer Natcha Suntorntarawong said the company this year would embrace the ‘efficient frontier portfolio’ as a key strategy in helping customers to optimise their investment portfolio based on their risk appetite. The company has three portfolio optimisers – conservative, moderate and aggressive – with average returns of 4 per cent, 5.5 per cent and 7.5 per cent, respectively.
A durable-equities fund is the focus fund product being offered to customers this year, as it can maintain a sustainable return in all market circumstances, she said.
The company will also focus more on non-profit organisation customers, advising them to invest in a private fund to get a higher return than what is on offer from deposits, she added.
Targeting such organisations is part of its business plan this year to expand its institutional-investor customer base, which currently accounts for 55 per cent of AUM.
The Good Corporate Governance Long Term Equity Fund (CG-LTF) is another fund offered by the company, while it will also launch a CG-RMF (corporate governance retirement mutual fund) to investors after seeing high demand for such an instrument, Natcha said.
Chief investment officer Siripun Sutharoj said that the company had, meanwhile, significantly reduced its investment in listed company CP All after three executives of CP ALL were fined by the regulator for using inside information to buy shares in Siam Makro.
