• 
• 

Published on August 1, 2007

The UOB Select SET 50 Index Link 1 Fund will invest in local banks' structured notes with a capital guarantee, with the return depending on the movement of the SET 50 Index over the next three years.

Last year, UOB Asset Management (UOBAM) launched a similar fund.

The return will be calculated by taking the average of the SET 50 Index marked at the end of each month for 36 months.

The average value will be deducted by the index on the fund's inception date.

Chief investment officer Korawut Leenabanchong said that looking forward three years, the SET 50 would likely head upwards.

"Even though the general election hasn't taken place yet, the index has already adjusted. With the promising signs of the election and the elected government-to-be, the economy looks bright, with corporate profits and other driving factors expected to go in an optimistic way. Looking at the macro picture, investing in the SET 50 is just another alternative for investors," he said.

CEO Vana Bulbon said the fund carried no currency risk, because it would invest in baht.

"The economy is actually in good shape. We have a trade surplus, low inflation, a low non-performing-loan rate, low interest rate and low leverage in the private sector. Gross consumption was recently revised upwards, to 5 per cent. The economy is picking up, not taking the political factor into account."

With interest rates coming back down, last month the company's foreign-investment-fund (FIF) portfolio surged from a little over Bt200 million to Bt9.95 billion after six FIFs were rolled out.

UOB Smart Asia, launched last month, raised Bt1.8 billion, the second-biggest such exercise for FIFs in the industry.

The firm brought out five more FIFs invested in highly rated foreign-bank promissory notes.

Vana said the spread between these promissory notes and government bonds is about 50 basis points. The company will launch more of this type of fund this year, if the spread is maintained at 30 basis points.

He expects the FIFs to contribute Bt5 billion to Bt8 billion to the company's total assets under management this year.

The Association of Investment Management Companies said that as of July 20, the company had Bt54.77 billion of assets under management.

Piyarat Setthasiriphaiboon

The Nation