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Amid low deposit rates, higher-yield funds emerge

Fund companies are gearing up to launch fixed-income and property funds offering attractive returns.

Somchai Boonnamsiri, chief executive officer of Krung Thai Asset Management (KTAM), said the company was opening two fixed-income funds for subscription from today to February 25. The funds, the three-month Krung Thai Thanasup B 117 (KTSUPB 117) and 12-month Krung Thai Thanasup B 103 (KTSUPB103), with average expected returns of 2.75 per cent and 3.25 per cent per annum respectively, will invest 75 per cent of total net assets in overseas fixed-income instruments, including deposits at the Bank of China and China Construction Bank, and 25 per cent in local bills of exchange.

KTAM Equity Index Link Complex Return 2 (KT-EY1Y6M2) is offered until February 21. About 44 per cent of the fund's assets will be invested in overseas instruments such as deposits at the Bank of China and China Construction Bank, 5 per cent in local instruments such as B/Es and debentures, and the rest in derivatives. The fund will provide return (if any) every six months.

Finansa Asset Management is also offering a six-month fixed-income fund (FAM FIPR6M5) with expected return of 3.10 per cent per year. The subscription period was set for February 17-24. Some of its assets will be invested in deposits of local and overseas banks with investment grade.

Alongkorn Prathanrasnikorn, executive vice president of One Asset Management, said it was waiting to set up property funds that had been filed to the Securities and Exchange Commission late last year. One of the funds, with total investment of Bt1.7 billion, will invest in a hotel in a province featuring tourist attractions and another fund, with total investment of Bt800 million, in a warehouse.

This year, deposit interest rates are expected to remain low, he said, adding that some money had moved out of deposits into property funds, given their higher and consistent returns.


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