One Asset Management debuts first Asean fund

One Asset Management Ltd has introduced Thailand’s first Asean index fund, the Stoxx Asean Select Dividend 30 Index, as it attempts to be a channel for retail investors to cash in on the burgeoning Asean Economic Community.

The open-ended Stoxx Asean Selected Index Fund will have a starting size of 50 billion baht, chief executive Win Udomrachtavanich said. Its policy is to invest in the 30 highest dividend plays in Asean over the past 12 months.

It will limit its investments in Thailand to five listed companies, with seven each in the other major Asean economies with an equal investment amount in each company.

The fund portfolio’s weighting will be reviewed each quarter.

The Stoxx Asean Selected Index has offered a world-record dividend yield of 4%, while its risk-adjusted return was 18.93%, well above other Asean indices.

One Asset and European Index launched the fund in March as a return benchmark for Asean investment. Real estate investment trusts will not be included.

Asean has the potential to grow by 5-6% a year on average over the next five years, jumping to 10% later, driven by growth in developing countries such as Cambodia, Laos, Vietnam and Myanmar, Mr Win said.

“Asean market integration this year will increase regional bargaining power in international trade due to the large population and expected free flow of labour, trade and investment in the region,” he said.

The combined Asean population is 625 million, he said.

One Asset plans to seek government approval to sell the fund across borders in the region under the Asean Passport Fund scheme so that initial public offering forms do not have to be refiled in Singapore and Malaysia.