“Aberdeen” launches ThaiESGX fund, promoting investment portfolio adjustments suitable for all market conditions
Aberdeen Asset Management launches “ABALL-TESGX”, a new tax-deductible fund, investing in a mix of stocks and debt instruments in the sustainability group, highlighting the strength of “adjusting investment portfolios” to suit all market conditions, combining the perspectives of world-class analysts and domestic fund managers with over 30 years of expertise in ESG investment. The IPO offering for investment units of “ABALL-TESGX1” is open from May 2-9, 68, and “ABALL-TESGX2” supports investors switching from LTF starting May 14, with investment opportunities by June 30, 68.
Mr. Robert Penalosa, Chief Executive Officer of Aberdeen Asset Management (Thailand) Co., Ltd. , revealed that Aberdeen Asset Management is offering for sale the " Aberdeen All Seasons Thailand Special Sustainability Fund" or "ABALL-TESGX," a new tax-deductible fund.
It is a special Thai Sustainable Mutual Fund (Thai ESGX) that focuses on investing in Thai sustainable securities at an average of not less than 80% per accounting year, with an average investment proportion in Thai sustainable stocks of not less than 65% per accounting year. Companies with strong fundamentals will be selected along with consideration of environmental, social and governance (ESG) factors to support sustainable investment.
For the investment policy of the fund "ABALL-TESGX" which is a mixed mutual fund (risk level 5) investing in ESG stocks and sustainability debt instruments that pass ESG criteria, there are 2 types of investment units to choose from: 1. ABALL-TESGX1, new investment type 2568, open for sale to interested investors, initial offering (IPO) between May 2-9, 2568 and open for investment again on May 14-30, 2568 and 2. ABALL-TESGX2, original investment type 2568, open for unitholders of long-term equity funds (LTF) to switch funds from May 14-30, 2568.
The highlights of the “ABALL-TESGX” fund include 3 aspects:
1) Dynamic Moves Across Market Cycles offers flexibility in adjusting the portfolio and investment allocation between stocks and bonds to suit market conditions at any given time. This differs from typical funds that are often a 70/30 mix, investing 70% in stocks and 30% in bonds.
Aberdeen believes that most investors who switch LTF funds to Thai ESGX funds are still at a loss and do not want to lose their principal. In addition, the investment has a holding condition of 5 years from the date of investment, which may cause investors to be concerned that the loss may not be worth the tax reduction. Aberdeen has therefore designed a fund in this format to meet investors' needs.
“Currently, fund managers view the Thai stock market as being in a recession, a bear market that is nearing its lowest point. Therefore, the investment framework is 65-75% in stocks and 25-35% in bonds, with a focus on value stocks and high-dividend stocks, with a greater weighting on large-cap stocks than small-cap stocks. However, if the stock market situation recovers, fund managers can reduce the weight of bonds to around 15-25% and increase the weighting on stocks to 75-85%, focusing on growth stocks, stocks that follow the market recovery trend, and increasing the weighting on small-cap stocks. Meanwhile, the proportion of investment in bonds may be short-term in some periods and long-term in some periods, depending on the market conditions at that time,” said Mr. Robert.
Furthermore, a key feature is 2) Robust Investment Process to Maximize Total Returns: strategizing and adjusting the portfolio to generate outstanding returns by accurately analyzing market conditions to optimize the allocation between stocks and bonds based on economic cycles and market trends.
It combines the appropriate investment proportion between stocks and bonds with expertise in finding individual assets to create a strong investment portfolio, including finding individual assets that meet the needs of each market condition for the opportunity to create the best returns at all times.
Key Feature 3) ESG Integration: Aberdeen conducts in-depth ESG analysis at every stage of the investment process and invests only in companies that meet Aberdeen's ESG criteria. Aberdeen is an asset management company focused on investing in ESG-positive assets, with over 30 years of experience and its own sustainability institute overseeing ESG. Furthermore, it has a dedicated ESG team in Asia based in Singapore to manage sustainable investments.
In terms of analyzing ESG factors on the stock side, fund managers will rank companies into 5 groups before considering investment, including:
- Best in Class Group: Companies that use ESG as an important part of their corporate strategy and provide full disclosure.
- Leader Group: Companies that have integrated ESG into their corporate strategy but are not market leaders and have good disclosure.
- Average Group The company applies ESG risk factors to its business operations and discloses information in accordance with regulatory criteria.
- Below Average Group Companies may have some contentious issues regarding financial information and have limited oversight of ESG issues and
- Laggard Group Companies with multiple financial data controversies and concerns about corporate governance, in which Aberdeen will only invest in companies that meet ESG criteria.
For the analysis of ESG factors on the bond side, fund managers assess and score ESG risks before making investment decisions. The ratings are divided into 3 groups: low risk, medium risk, and high risk. In addition, Aberdeen also helps promote and recommend that companies and issuers in which we will invest have better ESG development.
Ms. Darunrat Phiyodilokchai, Head of Equity Investment at Aberdeen Asset Management (Thailand) Co., Ltd., commented on her outlook for the Thai stock market, stating, "We believe the correction in the Thai stock market over the past two years has already reflected much of the risk of an economic recession. Currently, the SET Index at 1150 represents a forward P/E ratio of approximately 12X, which is very low compared to the past."
Investing in Thai ESGX funds over the next 1-2 months should be a good time for investors to save on taxes and also have the opportunity to generate good returns in the next 5 years. And if we consider the difference between the return on the SET Index and the return on 10-year government bonds, or the current Earnings yield gap, it is higher than 6%, which is a level close to the Covid period, even though the economy can still move forward.
Finally, we believe that the chances of investors suffering heavy losses from this point onwards are quite low because the Thai stock market is in a downtrend, unlike the period before the crisis in the past when the market was in an uptrend. Meanwhile, the current dividend yield, which is quite high, should help support the downtrend market. However, we believe that no matter what the economy is like, if we have strategies, processes, planning, and an experienced team, we will be able to find investment opportunities and opportunities to generate good returns in each market condition.”
For those interested in investing in this fund, special! Receive 100 baht ABCC investment units when investing every 50,000 baht in ABALL-TESGX1 and ABALL-TESGX2. However, the conditions are as determined by the company.
View more fund details > aberdeeninvestments.com
See more details about the promotion > abrdn.com
- understand product characteristics return conditions and risks before investing
- Investors should study information about tax benefits specified in the mutual fund investment manual.
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