Asset Plus launches three FIFs

"If the economy is in a recovery stage over the next two to three years, these assets will offer attractive returns to investors. Moreover, oil and gold are hedging instruments," Asset Plus senior fund manager Win Udomrachtavanich said yesterday at a press briefing.

The three funds will invest in exchangetraded funds (ETFs) listed on the NYSE Arca and the Singapore Exchange.

ASPOil will invest in the PowerShares DB Oil Fund, based on the Deutsche Bank Liquid Commodity Index - Optimum Yield Oil Excess Return. This is a rules-based index composed of futures con¬tracts on light sweet crude oil (West Texas Intermediate).

ASP-Gold will invest in the SPDR Gold Trust, the world's biggest ETF backed by bullion. Its correlation with the spot gold price is very close.

ASP-S&P500 will invest in the SPDR S&P500 ETF, which allocates assets in 500 stocks listed on the S&P 500. Its return is therefore in close correlation to the S&P 500.

Investment in ASP-Oil and ASP-Gold will be fully hedged against foreign exchange risk, while that in ASP-S&P 500 will fully hedge during a normal situation but not do so during adverse events, Win said.

ASP-Oil's and ASP-Gold's subscription periods run until June 25 and June 30, respectively. ASP-S&P500 is expected to be launched from the end of June to July 14, as the fund is pending Securities and Exchange Commission approval.

Oil can be a hedge against the US dollar and inflation and its price always surges when there is an economic turnaround, Win said.

Gold is a safehaven asset, as well as a dollar hedge and diversification instrument. Besides, demand is solid in China, India and the Middle East, he added.

He said the S&P500 covered companies investing around the world, so their earnings would improve following the economic rebound.

"Inflation will spiral up earlier than expected due to fund flows and an oil price hike," he said.

Managing director Ladawan CharoenRajapark said Asset Plus Securities had targeted that its assets under management (AUM) would rise by about Bt10 billion to Bt30 bil¬lion by yearend, from Bt19.5 billion at the end of last year.

As of Tuesday, the company's AUM of private funds amounted to Bt2.67 billion, while that of mutual funds stood at Bt20.47 billion.

Asset Plus Fund Management will launch a structurednote fund in the second half of the year, she said.

The fund will focus on building its customer base in large clients, state enterprises and government agencies.