Financial Calculators
Kuala Lumpur: CIMB-Principal Asset Management Berhad (“CIMB-Principal”) today announced the launch of the CIMB-Principal Opportunistic Bond Fund, its first fund to offer investors access to non-Ringgit convertible bonds issued by blue chip companies from the Asia-Pacific region.
J. Campbell Tupling, Chief Executive Officer of CIMB-Principal, stated: “The sell-off in equities over the last half of 2008 has resulted in attractive prices for high grade corporate bonds. This creates a rare opportunity for fixed-income investors, who are being very well-compensated to hold non-Ringgit convertible bonds of blue chip companies at a time when Malaysian fixed deposits are giving only about 3.5%, and could give less moving forward. With the CIMB-Principal Opportunistic Bond Fund, investors can potentially obtain better returns from high-quality, stable corporate bonds, which are considered relatively low-risk investments.”
The 3-year close-ended Fund will pursue a buy-and-hold strategy, which means the portfolio will be buffered from future interest rate fluctuations. “I firmly believe this Fund offers retail investors the best chance to potentially make money in the credit bond market, provided they maintain their investment until the Fund matures,” added Tupling.
Investors could also exit the Fund early if total performance reaches 40% before the Fund matures and the Fund Manager exercises its discretion to terminate the Fund and return the investment proceeds to investors before maturity. This is possible if equity prices rally sharply and the convertible bonds can be sold at a premium.
Tupling continued: “Retail investors can expect a better outlook for bond funds in 2009 with Bank Negara emphasizing a pro-growth policy to encourage spending by lowering the interest rate further. As the CIMB-Principal Opportunistic Bond Fund is only open for investment for 45 days, I encourage investors to consider the advantages of this investment before the Fund closes on 28 February 2009.”
The CIMB-Principal Opportunistic Bond Fund has an approved fund size of 200 million units, and an initial selling price of RM1.00 per unit. It will invest up to 98% of the Fund’s NAV (net asset value) in non-Ringgit denominated bonds and other fixed and floating rate instruments (including convertible bonds) issued or backed by governments, government agencies, supranational organizations, corporates or other issuers in the Asia-Pacific region. The remainder of the Fund is placed in liquid assets such as bank deposits for liquidity and ancillary purposes.
The CIMB-Principal Opportunistic Bond Fund is distributed by CIMB Bank, CIMB Private Banking, CIMB Investment Bank, CIMB Wealth Advisors and Standard Chartered Bank.
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