RHB Mudharabah Fund Report - October 2017

Transcription

1. FUND FACTSHEET – OCTOBER 2017 All data expressed as at 30 September 2017 unless otherwise stated RHB MUDHARABAH FUND This Fund aims to provide a balanced mix of income and potential for capital growth by investing in stocks listed on the Bursa Malaysia or on any other stock exchanges, unlisted stocks and Islamic debt securities and other non-interest bearing assets acceptable under principles of Shariah. The Fund’s activities shall be conducted strictly in accordance with the requirement of the Shariah principles and shall be monitored by the Shariah Adviser of the Fund. INVESTOR PROFILE INVESTMENT STRATEGY This Fund is suitable for Investors who want: • an investment that complies with the principles of Shariah; • a professionally managed portfolio of Shariah compliant equities, sukuk and Islamic debt securities; • to have a balanced portfolio that provides both income and capital growth; and • to invest in shares but do not have the time to manage their own portfolio. • Up to 60% of NAV will be invested in Shariah-compliant equities; • Minimum of 40% of NAV will be invested in Islamic debt securities (“sukuk”), Islamic money market instruments and/or liquid assets acceptable under Shariah principles. FUND PERFORMANCE ANALYSIS FUND DETAILS Performance Chart Since Launch* Manager Trustee Fund Category Fund Type Launch Date Unit NAV Fund Size (million) Units In Circulation (million) Financial Year End Cumulative Performance (%)* 1 Month Fund 0.12 Benchmark 0.32 3 Months 0.27 0.30 6 Months 1.43 0.72 YTD 9.93 4.46 3 Years -3.19 2.52 5 Years 3.64 15.57 Since Launch 65.38 N/A 2015 7.08 2.79 2014 -12.27 -1.66 2013 6.06 9.65 1 Year 8.13 3.44 Fund Benchmark Calendar Year Performance (%)* 2016 Fund -7.40 Benchmark -1.44 Source: Lipper IM MER (as at 28 Feb 2017) Min. Initial Investment Min. Additional Investment Benchmark Sales Charge Redemption Charge Annual Management Fee Annual Trustee Fee Switching Fee Redemption Period 2012 9.38 8.57 Distribution Policy *The implementation of GST will be effective from 1 April 2015 at the rate of 6% and the fees or charges payable is exclusive of GST. *For the purpose of computing the annual management fee and annual trustee fee, the NAV of the Fund is exclusive of the management fee and trustee fee for the relevant day. FUND PORTFOLIO ANALYSIS Sector Allocation* Unquoted Bond Trading/Services Industrial Products Consumer Products Technology Construction Infrastructure Consumer Property Finance Cash 38.98% 12.64% 6.27% 4.94% 4.79% 2.60% 1.25% 1.23% 0.84% 3.94% 0% 10% 20% FUND STATISTICS Historical NAV (RM) 1 Month High 0.8340 Low 0.8280 22.52% RHB Asset Management Sdn. Bhd. CIMB Islamic Trustee Bhd Balanced (Shariah- compliant) fund Capital Growth and Income Fund 09 May 1996 RM0.8314 RM15.70 18.88 28 or 29 February 1.80% RM1,000.00 RM100.00 50%FBM Emas Shariah + 50%MIB12 mths Islamic FD-i Up to 6.00% of NAV per unit* None Up to 1.50% p.a. of NAV* Up to 0.09% p.a. of NAV* RM25.00 per switch* Within 10 days after receipt the request to repurchase Incidental 12 Months 0.8385 0.7554 Since Launch 1.0388 0.4095 Source: Lipper IM 30% 40% Top Holdings (%)* RHBA (AA3) UNITED U-LI CORPORATION BHD EKVE SDN BHD (AAA) ANIH BERHAD (AA) MEX II (AA-IS) *As percentage of NAV RHB Asset Management Sdn Bhd (174588-x) 50% 6.38 4.69 3.45 3.39 3.33 Historical Distributions (Last 5 Years) (Net) Distribution Yield (%) (sen) 28 Feb 2017 29 Feb 2016 28 Feb 2015 26 Feb 2014 4.0000 4.56 28 Feb 2013 3.5000 - Source: RHB Asset Management Sdn. Bhd. Head Office: Level 8, Tower 2 & 3, RHB Centre, 50400 Kuala Lumpur General Line: 603-9205 8000
2. FUND FACTSHEET – OCTOBER 2017 All data expressed as at 30 September 2017 unless otherwise stated RHB MUDHARABAH FUND This Fund aims to provide a balanced mix of income and potential for capital growth by investing in stocks listed on the Bursa Malaysia or on any other stock exchanges, unlisted stocks and Islamic debt securities and other non-interest bearing assets acceptable under principles of Shariah. The Fund’s activities shall be conducted strictly in accordance with the requirement of the Shariah principles and shall be monitored by the Shariah Adviser of the Fund. MANAGER'S COMMENTS MARKET REVIEW EQUITY Asia Ex Japan equities stayed flat in September 17 (-0.3%), taking YTD returns to 28.5%. China, up 0.8% during the month despite faced sell-off pressures towards the end of the month as investors resorted to profit-booking after the first ratings downgrade from S&P since 1999 on account of surging debt. The decline was aided by plunging property stocks following a host of housing curbs announced in the Mainland. Indian equities (-3.7%) were weighed down by currency losses (-2.2%) as the economy suffers from slowdown in growth, worsening current account deficit and clogged bank balance sheets. Korea (+2.0%) was led by the tech sector (+8.3%) as it leveraged on its superior 2017 EPS growth. Taiwan (-3.4%) bore the brunt of the adverse impacts of production delays for iPhone X and lukewarm demand for iPhone 8 on Apple's supply chain. Indonesia (-0.8%) had a 25bp rate cut for the second consecutive month. Hong Kong lost 0.7%, and Singapore 1.4%, while Thailand added 2.8%. September 17 was a negative month for Malaysia. The KLCI rebounded at the start of the month to peak at 1,789 pts on 12 Sep 2017, but only to give up much of those gains and more when the Federal Reserve signalled one more rate hike towards year end. For the month, the KLCI edged down 17.6pts or 1% to close at 1,756pts. The market traded in the narrow range of 1,755 to 1,789 pts during the month. The broader market outperformed the KLCI, as the FBM Emas fell 0.6% mom to 12,531pts. The key sectors that dragged down the KLCI in Sept 17 was the finance and technology sectors. Small caps did better, with the FBM Small cap index rising 1.2% to 16,950pts. However. Average daily value traded on Bursa in Sep rose 30% mom to RM2.5bn. Malaysia net inflow of foreign funds is top in ASEAN with RM11 bil worth inflow so far in year 2017. USD:MYR was flat at 4.22 while 10Y MGS was 25bps higher at 3.92%. Crude oil price rose 13% mom to $58/bbl, driving outperformance in the Energy (Sapura-led) and Materials (PChem-led). On the corporate side, CIMB Group will acquire the entire equity stake in Jupiter Securities Sdn Bhd for RM55 mil, paving way for the partnership with China Galaxy for the local operations. Transport Minister said the government is considering expediting plans for the MRT3 project and MRT2 is planned to be completed in 2024 and MRT3 in 2027. IOI Corp is selling a 70% controlling stake in its oleo chemical units (IOI Lipid Enzymtec Sdn Bhd and IOI Edible Oils (HK) Ltd) to Bunge Ltd for US$595 mil(RM2.5 bil) plus €297mil (RM1.44 bil), total of RM3.94 bil. MISC plans to dispose of its entire 45% stake in Centralised Terminals Sdn Bhd to Dialog for RM193 mil. FIXED INCOME US Treasuries (“UST”) saw a bear flattening in September 2017 despite the resurgence of the North Korea-US tensions. Focus was largely on the Fed announcement in the September 2017 FOMC meeting that it will start to reduce its balance sheet size from October by putting cap on reinvestments amount by USD10 billion per month, then increase USD10 billion every quarter before reaching a maximum of USD50 billion per month. The Fed also surprised market by still expecting another 25bps Fed Fund Rate hike in 2017, most likely in December 2017. At the end of the month, President Trump release his tax reform plans which was largely as expected, collapsing the personal tax rates, reforms on estate tax, tax credits for care of the elderly and sick, and a cut in corporate tax rates. As market continue to price in the positive effects on price and growth of this reform amid Fed hawkish remarks, USTs closed higher with 2-, 5-, 10- and 30-year closed at 1.48% (August 2017: 1.33%), 1.94% (1.70%), 2.33% (2.12%) and 2.86% (2.73%) respectively. On the local front, Bank Negara Malaysia (“BNM”) maintained Overnight Policy Rate (“OPR”) unchanged at 3.00% in September 2017 Monetary Policy Meeting (“MPC”) as widely expected. The central bank sounded neutral and reiterated its view of a sustained higher growth from firm domestic demand a spill overs from the external sector. Inflation outlook also remained contained although there was a slight uptick in August 2017 headline CPI numbers to 3.7% (concensus: 3.4%; July 2017: 3.2%) mainly driven by an increase in transportation cost from higher fuel prices (Brent oil towards USD55 to 60 per barrel) while prices of F&B also inched higher but core inflation remained contained at 2.4% (July: 2.6%). July exports on the other hand grew 30.9% YoY from the 10% recorded in June 2017 on back of base effects and the distortive festive period. Imports rose sharply to 21.8% YoY during the same period from 3.7% previously. Malaysia’s July Industrial Production rose stronger than expected to 6.1% YoY beating expectations (consensus: 5.1%) on the back of the pick-up in manufacturing activity and electricity output. Given the stronger prospect in industrial and external activities, we expects real GDP to grow by 5.3% in 2017 and 5.4% in 2018 versus 4.2% in 2016. Malaysia external reserves rose another USD0.3 billion in the first two weeks of September 2017 to USD100.8b on the back of capital inflows are sufficient to mitigate capital flow risks based on IMF’s Assessment of Reserve Adequacy with a ratio of 115%. Foreign investor trimmed RM1.1 billion worth of MYR government bonds in August 2017 marking a third consecutive month of net selling. Foreign holdings stood at 26.4% of outstanding MGS+GII marginally lower than 26.5% the month prior. Maturity-driven outflow asides, foreign buying in domestic bond market has improved since mid-August 2017 with foreign real money interest in benchmarks and off-the-runs especially in the belly sector. But overall government bonds level weakened late in the month tracking losses in global bonds reacting to the renewed anticipation of December 2017 Fed hike and Trump’s tax reforms on top of the geopolitical risks. The 3-, 5-, 7-, 10-,15-, 20- and 30-years MGS closed the month mixed at 3.39% (August 2017: 3.36%), 3.57% (3.56%), 3.84% (3.85%), 3.92% (3.89%), 4.38% (4.31%), 4.51% (4.53%) and 4.79% (4.72%) respectively. Movement in the Government Investment Issue (“GII”) followed suit with the 3-, 5-, 7-, 10-, 15-, 20- and 30 years last trading at 3.50% (August 2017: 3.49%), 3.74% (3.70%), 4.03% (3.97%), 4.11% (4.05%), 4.61% (4.52%), 4.67% (4.71%) and 4.85% (4.89%) respectively. September 2017 saw large issuances of corporate bonds with a combined amount of MYR17.1 billion of primaries bringing the YTD issuances to just under MYR81.9 billion. About half of the issuances were GG with names like LPPSA (MYR3.5 billion), Prasarana (MYR4.0 billion) and GovCo (MYR1.2 billion). In AAA segment, we saw Danga Capital issued a 10 years paper of MYR1.5 billion at 4.52%. Telekom also printed MYR500 million of 10 years tenor at 4.58% while Putrajaya Bina issued MYR600 million of 5, 7, 9 and 10 years at 4.33%, 4.45%, 4.55% and 4.60% respectively. MARKET OUTLOOK AND STRATEGY EQUITY The global equity markets are currently pricing in a pick-up in growth, which means that there is a chance of further price increases. However, while the economic data are indeed favourable, investors are currently not paying enough attention to risks, such as geopolitical tensions. The equity markets might enter choppier waters if the global economic data weaken, a development which appears possible and the international central banks gradually normalise their monetary policies. The growth cycle’s late stage puts the global economy at risk from unexpected events like a major pullback in the US equity market that continues to hit record highs. Domestically, rising raw material prices etc steel and labor cost may post a concern to the construction sector despite slew of contract flows. We turned cautious on construction sector as margins will be affected by rising cost. In this scenario, we would advocate to buy on weaknesses. In terms of growth, we still like tourism related sector and building materials. FIXED INCOME The US Fed affirmed its monetary tightening bias, keeping dot plots unchanged for 2017 and 2018 which suggests another rate hike this year most probably in December 2017 and another 3 hikes next year. In addition to that, the Fed announced that it will begin to shrink its balance sheet from end-October 2017. Overall, it is still fairly hawkish Fed view relative to what current market pricing although the longer end projection were revised lower. In Malaysia, focus this month will be on Budget 2018 which is expected to be tabled in October 2017. Government is likely to continue its effort in narrowing budget deficit to strike a balanced budget by 2020 on top of a “people’s friendly” budget in anticipation of the upcoming General Election. We are still seeing strong pipeline issuances with supply expected in the GG and AAA government linked names. The current strength of the Ringgit and stability of MGS yield curve both signal investor confidence and investment opportunities for foreign investors that will support our domestic market. On that note, we remained overweight duration on Money Market and Sukuk. DISCLAIMER: Based on the fund’s portfolio returns as at 15 September 2017, the Volatility Factor (VF) for this fund is 9.3 and is classified as “High”. (source: Lipper) “High” includes funds with VF that are above 8.2 but not more than 10.7 (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 VC referred to was dated 30 June 2017 which is calculated once every six months and is valid until its next calculation date, i.e. 31 December 2017. A Product Highlights Sheet (“PHS”) highlighting the key features and risks of the Fund is available and investors have the right to request for a PHS. Investors are advised to obtain, read and understand the PHS and the contents of the Master Prospectus dated 15 July 2017 and its supplementary(ies) (if any) (“the Master Prospectus”) before investing. The Master Prospectus has been registered with the Securities Commission Malaysia who takes no responsibility for its contents. Amongst others, investors should consider the fees and charges involved. Investors should also note that the price of units and distributions payable, if any, may go down as well as up. Where a distribution is declared, investors are advised that following the issue of additional units/distribution, the NAV per unit will be reduced from cum-distribution NAV to exdistribution NAV. Any issue of units to which the Master Prospectus relates will only be made on receipt of a form of application referred to in the Master Prospectus. For more details, please call 1-800-88-3175 for a copy of the PHS and the Master Prospectus or collect one from any of our branches or authorised distributors. The Manager wishes to highlight the specific risks of the Fund are stock market risk, individual stock risk, liquidity risk, issuer risk, interest rate risk, credit / default risk and shariah specific risk. These risks and other general risks are elaborated in the Master Prospectus. This factsheet is prepared for information purposes only. It does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive it. Past performance is not necessarily a guide to future performance. Returns may vary from year to year. RHB Asset Management Sdn Bhd (174588-x) Head Office: Level 8, Tower 2 & 3, RHB Centre, 50400 Kuala Lumpur General Line: 603-9205 8000