Citi Thai offers foreign series

Citibank Thailand has partnered with Franklin Templeton Investment to launch six offshore funds for Citi Gold customers to invest directly in foreign assets.

The six offshore mutual funds are the “Franklin Next Step Series”, which comprises stable growth, balanced growth, dynamic growth, emerging markets and small companies, technology, and a floating-rate fund.

Don Charnsupharindr, retail banking head at Citibank Thailand, said it is the only bank in Thailand where domestic investors can invest directly in offshore mutual funds with the same fee as foreign investment funds (FIFs) offered by other financial institutions in the country.

This service is offered to Citi Gold customers, classified as those having total investment deposits of at least 5 million baht.

FIFs have continued growing over the past few years. However, only a handful of FIFs invest directly in foreign assets through Thai fund managers, as most invested via a master fund.

Mr Don said customers can choose to invest in foreign assets through the FIF or directly in foreign mutual funds.

The difference between i nvesting through the FIF and direct investment is the foreign exchange risk, as FIFs issued by local asset management companies may hedge, meaning net returns are after hedging is included.

If customers decide to invest directly in foreign mutual funds, the return will be quoted in US dollars or local currency, depending on the performance of each fund.

“Given the rallies in the equity and bond markets since the start of 2017, investors should safeguard their gains by rebalancing and diversifying their investment portfolios. There are opportunities for investors, with overweight positions in emerging markets and the euro zone,” said Mr Don.

The bank expects global economic growth and corporate earnings to grow by 3.4% and 9% next year, respectively.

Two fundamental factors having a positive effect on the global financial market in 2018 are a strengthening global economic recovery as well as global central banks shifting gradually towards monetary tightening, he said.