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Published on January 9, 2008

Growth was spearheaded by long-term mutual funds (LTFs), which

- spurred by a sales spike last month

- almost doubled, from Bt25.1 billion to Bt49.4 billion.

Retirement mutual funds (RMFs), which lock in investment for 50 years against five years for LTFs, grew 49 per cent to Bt38 billion.

Maris said part of the increase stemmed from an increase in new investors - an additional 46,697 for a total of 259,430 investors as of last June 30.

SCB Asset Management, the larg-est player in LTFs at Bt15 billion, welcomed 15,000 new customers, said Kampol Adsavakulchai, executive vice president for mutual funds.

Maris said although 2008 was the first year LMF investors could cash out, the first week saw only 1.32 per cent of total assets redeemed.

Kampol believes this reflects a trend, since most early LTF buyers were sophisticated investors who were likely to hold onto LTFs exhibiting good growth and not cash out so soon.

The number of people earning monthly salaries of Bt30,000 is 500,000 and rising, so this is the market to tap into, Kampol said, citing the latest figures from 2006.

"[High-income earners] who pay 30-37-per-cent income tax have been consistently buying RMF and LTF units," said Thanachart Fund managing director Boonchai Kiat-tanavith.

The 20-per-cent bracket has also been maturing.

"But for the long term, it's not easy to tap into the market of those with 10-per-cent income tax," he added.

Ki Nan Tsui

 The Nation