Kenanga Shariah Balanced Fund Report - February 2018

Transcription

1. February 2018 Market Review and Outlook Mixed Assets Market Review Fed started to double the pace of its balance sheet reduction from USD10b to USD20b and will increase it by USD10b every three months . Meanwhile, ECB’s plan is to reduce asset purchases from EUR60b to EUR30b until at least September. Bank of Japan reduced purchase of 10 to 25-year bonds and 25 to 40year bonds by JPY10b each. China’s December data were broadly within expectations but 4Q17 GDP growth was higher than expected and brought 2017 GDP growth to 6.9%, the first pick-up since 2010. After the US Government shutdown ended, President Trump slapped steep tariffs of 20-50% on imported washing machines and solar panels. Korea stock exchange announced KRX300 Index to be launched on Feb 5, another bright spot for small-mid caps. MSCI Asia Pacific ex-Japan posted the best monthly return since March 2016, gained 7.5% and outperformed MSCI World’s 1%. Leaders were HSCEI (+15.7%), Hang Seng (+9.8%) and SHCOMP (+8.9%). Upward revision on global growth forecast, USD weakness and increasing commodities prices presented an upbeat sentiment. Financials re-rated on better macroeconomic backdrop, Internet sector recovered after remaining subdued for the previous two months as investors rotated into value stocks but Technology hardware was still plagued by smart phone shipment concern. Brent and WTI crude oil were up 3% and 7% respectively due to strong demand in extremely cold winter. MYR, THB and RMB top the list of best-performing currencies, while PHP, KRW and HKD among the worst performers. On the domestic front, FBMKLCI closed 4% higher driven by financials that rallied on 25bps OPR hike by Bank Negara and the outperformance of PNB-related companies. Net inflows expanded by another RM3.4b in January after total inflows of RM10.8b in 2017, and international reserves continued to grow to USD103b as at Jan 22. Other key news includes the tender submission for MRT Circle Line by three Malaysian consortiums and a Chinese joint-venture. 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. Mixed Assets Market Outlook Sentiment turned negative stepping into February with all markets reversing their earlier gains and Malaysia was no exception. We believe fundamentals have not changed materially to warrant a trend reversal, although equities valuations have admittedly turned overly expensive for certain markets, rendering this correction somewhat timely. Specifically for Malaysia, our positive view is supported by the strong economic growth, improving corporate earnings, whilst the appreciating MYR is supportive of fund flows. Post-election, we anticipate the return of foreign flows and certain themes like rising FDI, China’s Belt Road Initiatives, railway construction awards, GLC transformation should become more discerning in 2H, providing the positive backdrop. 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. February 2018 Market Review and 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. Mixed Assets Fund Strategy Although the rapidity of the selloff is fraying sentiment at the moment, we believe momentum will return once the dust has settled. With the timeline of GE14 closing in, we will tactically be more defensive and adopt buy-on-weakness strategy in the next 3 months. The Fund will continue to invest in a diversified portfolio consisting principally of fixed income securities and other permissible investments. 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 2 Strictly for Clients of Kenanga Investors Berhad
3. 3-year Fund Volatility Kenanga Islamic Balanced Fund 4 .9 February 2018 Low Lipper Analytics 15 Jan 2018 FUND PERFORMANCE (%) FUND OBJECTIVE Aims to achieve steady capital growth and income distribution (if any) over the medium to long-term period by investing in a diversified portfolio of authorised investments in accordance with Shariah requirements. % Cumulative Return, Launch to 31/01/2018 140 120 100 80 60 Fund Category/Type Balanced (Islamic) / Growth & Income 40 20 0 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 Kenang a Islamic Balanced : 124.85 Trustee CIMB Islamic Trustee Berhad Dec 10 Jun 09 Dec 09 Jun 08 Dec 08 Jun 07 Dec 07 Jun 06 Dec 06 Jun 05 Dec 04 Dec 05 -20 Launch Date 06 December 2004 60% FTSE Bursa Malaysia Emas Sh ariah Index an d 40% Mayban k 12-month GIA Rate : 90.84 Source: Novagni Analytics and Advisory Sdn Bhd CUMULATIVE FUND PERFORMANCE (%) # Benchmark 60% FTSE Bursa Malaysia Emas Shariah Index and 40% Maybank 12-month GIA Rate Period 1 month 6 months 1 year 3 years 5 years Since Launch External Investment Manager / Designated Fund Manager Ahmad Tajuddin Bin Yeop Aznan Sales Charge Max 5.50% # Annual Management Fee 1.50% p.a. Fund 0.58 1.34 4.21 8.69 23.36 124.85 Benchmark 1.89 5.47 8.87 7.81 21.44 90.84 Redemption Charge Nil Period 2017 2016 2015 2014 2013 Fund 4.29 -0.77 6.56 -1.40 11.04 Benchmark 8.20 -2.95 2.74 -1.94 10.04 Source : Lipper , 31 January 2018 DISTRIBUTION HISTORY * Gross Distribution Date RM Yield (%) Unit Split 16-May-16 2.79 sen 6.62% 26-Feb-15 4.00 sen 8.71% 26-Feb-14 3.00 sen 6.27% - Annual Trustee Fee 0.05% p.a. CALENDAR YEAR FUND PERFORMANCE (%) # HISTORICAL FUND PRICE * Date Since Inception Highest RM 0.6885 11-Jan-08 Lowest RM 0.3841 12-Mar-09 FUND SIZE * RM 17.42 million NAV PER UNIT * RM 0.4158 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 (% NAV) * January 26.10% CP / Sukuk / Others 1 2 3 4 5 33.80% 40.10% 33.50% 30.10% 36.40% December November SECTOR ALLOCATION (% NAV) * 23.40% Liquidity TOP EQUITY HOLDINGS (% NAV) * TENAGA NASIONAL BHD MALAYSIAN RESOURCES CORPORATION BHD DIALOG GROUP BHD IJM CORPORATION BHD KERJAYA PROSPEK GROUP BHD 36.80% 39.80% Equity 4.08% 2.76% 2.00% 1.95% 1.87% Corporate Sukuk (Unsecured) Short Term Islamic Deposits and Cash Trading and Services Construction Industrial Products Properties Consumer Products Corporate Sukuk (Secured) Plantations Finance Others 1 2 3 4 5 31.7% 26.1% 13.6% 9.1% 5.1% 3.6% 3.5% 1.9% 1.5% 1.2% 2.7% TOP FIXED INCOME HOLDINGS (% NAV) * MUMTALAKAT IMTN 5.35% 30.04.2018 GOLDEN ASSETS INTERNATIONAL 4.7520180803 MEX II SDN BHD 5.6020260429 BGSM MANAGEMENT SDN BHD 5.4520240628 MMC CORP BHD 5.2920230426 4.54% 3.70% 2.07% 2.04% 2.00% * 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 4.93 and is classified as “Low”. (Source: Lipper). “Low” includes funds with VF that are above 1.785 and less than or equal to 6.045 (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. “Cooling-Off Period” or “Cooling-Off Right” is not applicable to EPF Member Investment Scheme (EPF MIS). 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 stock specific risk, credit and default risk, interest rate risk, reclassification of Shariah status risk, currency risk and country risk.