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Published on November 3, 2007

With the offering tentatively scheduled for the end of the month following approval from the Securities and Exchange Commission, the fund - devoted to fast-growing companies in Brazil, Russia, India and China - will be something of a greatest-hits compilation, managing director Ladawan Charoen-Rajapark said yesterday.

The ASP BRIC Fund will invest in the Templeton BRIC Fund, set up in June. The fund's management will be led by globe-trotting Mark Mobius, who is known as an early earnest advocate of emerging-market stocks.

Mobius pointed out three major risks in an article posted on Franklin Templeton Investments' website - currency fluctuation, economic instability and political development.

With China raising its fuel prices by 10 per cent in a bid to stabilise national supply and ExxonMobil reporting a 10-per-cent drop in quarterly profit, such risks, along with geopolitical tensions in, for instance, Russia, must not be overlooked.

But what differentiates the Templeton fund from competitors is its bottom-up approach, ASP fund manager Suttinee Simakulthorn said.

Instead of a centralised approach, the feeder fund has fund-managers stationed in these countries to pick and monitor the stocks. "So unlike funds that tie themselves to indices, this one will not be so much affected on the macro level," she said.

As of September 30, 37 per cent of the fund was invested in the energy sector and 19.7 per cent in materials. Some of the top 10 holdings are Brazilian mining company Cia Vale do Rio Doce, Russian gas giant Gazprom and PetroChina. A large weighting will be given to China with 34 per cent followed by Brazil and Russia at 26 and 23 per cent respectively.

Suttinee is optimistic that the BRIC economies will keep growing at about 9 per cent a year for the next 10 years.

Ki Nan Tsui

The Nation