Kenanga Bon Islam Fund Report - February 2018

Transcription

1. February 2018 Market Review and Outlook Bond Market Review As widely expected , the Federal Open Market Committee (FOMC) left the Federal Fund Rate (FFR) at 1.50% in the meeting on 31 January 2018 and has guided that inflation is expected to move higher in 2018. For the month of January, the US Treasuries (UST) yield curve bearish steepened, with the 2x10 spread widened to 58 basis points (bps). As players continued to price in gradual rate hikes, the 2- and 10- year UST closed month-end at 2.14% (+25 bps) and 2.72% (+32 bps) respectively. The Malaysian Government Securities (MGS) started off the year on firmer footing, on the back of stronger MYR. In the Monetary Policy Committee (MPC) meeting on 25 January 2018, Bank Negara Malaysia (BNM) increased the Overnight Policy Rate (OPR) by 25bps to 3.25%. Post-MPC, overall interest on MGS was higher with players nibbling on the short-end off the-runs and the 5-year Government Investment Issue (GII). For January 2018, the MGS yield curve bearish flattened slightly. At the month-end closing, the 3-, 5-, 7and 10-year benchmark MGS yields settled at 3.40% (+6 bps), 3.64% (+11 bps), 3.93% (+5 bps) and 3.95% (+2 bps) respectively. Meanwhile, the trading activities of corporate bonds have improved, supported by bargain hunting interest and were slanted towards AA-rated utility papers. Bond Market Outlook As inflationary pressures have eased in recent months, it is expected that central bank will not rush for a second hike. However, the risk of monetary tightening remains and would largely be data-dependent going forward, such as stronger-than-expected Gross Domestic Product (GDP) growth, driven by strong external sector and resilient consumer spending. We reckon that MYR bonds will remain supported in the near-term on foreign pent up demand on the back of strong MYR. However, we think that mild selling pressure will emerge when both FOMC and MPC statements remain hawkish. Bond Fund Strategy The Fund will continue to invest in a diversified portfolio consisting principally of fixed income securities and other permissible investments. The Fund will continue to invest in securities that have a minimum rating of “investment grade” i.e. rated at least BBB3 by RAM or equivalent rating by MARC or other rating agencies. The Fund will continue to invest in a diversified portfolio of sukuk and islamic money market instruments. The Fund will continue to invest in sukuk that have a minimum rating of “investment grade” i.e. rated at least BBB3 by RAM or equivalent rating by MARC or other rating agencies. The Fund will continue to invest in a portfolio of fixed income securities, equities and equity related securities (warrants, convertible loan stocks, transferable subscription rights and depository receipts) of companies in the Asia Pacific region. Kenanga Investors Berhad (353563-P) Level 14, Kenanga Tower, 237, Jalan Tun Razak, 50400 Kuala Lumpur Tel: 03-2172 3000 Toll Free: 1800-88-3737 www.kenangainvestors.com.my 1 Strictly for Clients of Kenanga Investors Berhad
2. Kenanga Bon Islam Fund 3-year Fund Volatility 1 .2 (A fund under Kenanga OneAnswer™ Investment Funds) Very Low February 2018 FUND OBJECTIVE Aims to provide investors with a regular income stream through investments in Islamic bonds and Islamic money market instruments. Lipper Analytics 15 Jan 2018 FUND PERFORMANCE (%) % Cumulative Return, Launch to 31/01/2018 90 80 70 60 Fund Category/Type Islamic Bond / Income 50 40 30 20 Launch Date 23 April 2004 10 0 Ken ang a Bon Islam : 50.65 Benchmark All Malaysian Government Investment Issue Jan 18 Jun 17 Jun 16 Dec 16 Jun 15 Dec 15 Jun 14 Dec 14 Jun 13 Dec 13 Jun 12 Dec 12 Jun 11 Dec 11 Jun 10 Dec 10 Jun 09 Dec 09 Jun 08 Dec 08 Jun 07 Dec 07 Jun 06 Dec 06 Jun 05 Dec 05 Apr 04 Trustee CIMB Commerce Trustee Berhad Dec 04 -10 All Malaysian Government Investment Issue : 80.51 Source: Novagni Analytics and Advisory Sdn Bhd CUMULATIVE FUND PERFORMANCE (%) External Investment Manager / Designated Fund Manager Musfirah Binti Mazlan Sales Charge Max 1.5% Annual Management Fee 1.00% p.a. Period 1 month 6 months 1 year 3 years 5 years Since Launch Fund 0.18 0.77 1.92 6.29 8.04 50.65 # Benchmark 0.51 1.91 4.18 13.17 19.84 80.51 CALENDAR YEAR FUND PERFORMANCE (%) Period 2017 2016 2015 2014 2013 Fund 2.33 2.54 1.42 1.75 -0.15 Benchmark 4.70 4.02 4.19 4.32 0.98 # Source: Novagni Analytics and Advisory Sdn Bhd ; Lipper, 31 January 2018 Annual Trustee Fee 0.07% p.a. FUND SIZE * RM 0.90 million Redemption Charge Nil NAV PER UNIT * RM 0.7421 HISTORICAL FUND PRICE * Since Inception Date Highest RM 0.7425 24-Jan-18 Lowest RM 0.4893 15-Jun-04 All fees and charges payable to the Manager and the Trustee are subject to GST as may be imposed by the government or other authorities from time to time. ASSET ALLOCATION * January December 5.00% 89.4% Short Term Islamic Deposits and Cash 5.0% Corporate Sukuk (Secured) 4.5% 98.20% 24.20% Liquidity 1 2 3 4 5 Corporate Sukuk (Unsecured) 95.00% 1.80% November SECTOR ALLOCATION (% NAV) * 75.80% Quasi Government Securities 1.1% CP / Sukuk / Others TOP FIXED INCOME HOLDINGS (% NAV) * GOLDEN ASSETS INTERNATIONAL 4.7520180803 CAHYA MATA SARAWAK 4.8020220505 SABAH CREDIT CORP 4.7720220505 GAMUDA BERHAD 4.8320221123 BGSM MANAGEMENT SDN BHD 5.4520240628 DISTRIBUTION HISTORY 13.60% 6.79% 6.75% 6.75% 5.80% Not Applicable * Source: Kenanga Investors Berhad, 31 January 2018 Based on the fund’s portfolio returns as at 15 January 2018, the Volatility Factor (VF) for this fund is 1.16 and is classified as “Very Low”. (Source: Lipper). “Very Low” includes funds with VF that are 0 and less than or equal to 1.785 (source: Lipper). The VF means there is a possibility for the fund in generating an upside return or downside return around this VF. The Volatility Class (VC) is assigned by Lipper based on quintile ranks of VF for qualified funds. VF is subject to monthly revision and VC will be revised every six months. The fund’s portfolio may have changed since this date and there is no guarantee that the fund will continue to have the same VF or VC in the future. Presently, only funds launched in the market for at least 36 months will display the VF and its VC. The Master Prospectus dated 30 June 2017 and the Supplemental Prospectus (if any), its Product Highlights Sheets (“PHS”) or Supplemental Disclosure Document (“SDD”) (if any) have been registered with the Securities Commission Malaysia, who takes no responsibility for its contents. A copy of the Master Prospectus, Supplemental Prospectus (if any), SDD (if any) and the PHS are obtainable at our offices. Application for Units can only be made on receipt of application form referred to in and accompanying the Master Prospectus and/or Supplemental Prospectus (if any), SDD (if any) and PHS. Investors are advised to read and understand the Master Prospectus, its PHS and any other relevant product disclosure documents involved before investing. Investors are also advised to consider the fees and charges before investing. Unit prices and distributions may go down as well as up. Where a unit split/distribution is declared, investors are advised that following the issue of additional units/distribution, the NAV per unit will be reduced from pre-unit split NAV/cum-distribution NAV to post-unit split NAV/ex-distribution NAV. Where a unit split is declared, investors should note that the value of their investment in Malaysian Ringgit will remain unchanged after the distribution of the additional units. A Fund’s track record does not guarantee its future performance. Investors are advised to read and understand the contents of the unit trust loan financing risk disclosure statement before deciding to borrow to purchase units. Kenanga Investors Berhad is committed to preventing Conflict of Interest between its various businesses and activities and between its clients / directors / shareholders and employees by having in place procedures and measures for identifying and properly managing any apparent, potential and perceived Conflict of Interest by making disclosures to Clients, where appropriate. The Manager wishes to highlight the specific risks of the Fund are interest rate risk, credit and default risk, reinvestment risk and counterparty risk. #