| Report Date | |
| Manager | |
| Fund Name | |
| Strategy | |
| Latest Return Date | |
| Latest Return | |
| Latest 6 Months | |
| Latest 12 Months | |
| Latest 24 Months | |
| Annualised Since Inception | |
| Inception Date | |
| FUM (millions) | |
| Fund Overview | |
| Manager Comments | The K2 Asia Absolute Return Fund returned 2.11% for the month of February. The MSCI Asia Pacific ex. Japan (AUD) returned 2.82% (+1.49% in local currency). February delivered another solid return led by The Philippines (+7.8%), Indonesia(+7.7%) and Australia (+5.2%). Eroding the quality of the region’s move was the performance of the Hong-listed China H-Shares which, at their low fell 8.5%, before partially recovering to end down 5.7%. After a near 35% run over the previous 5 months, sellers focused on China’s re-acceleration and the fear of policy tightening measures owing to high credit growth and a strong property market. Over February the Fund’s net exposure ranged between 95-100%. Despite solid equity market returns over the past six months, expectations of continued fund inflows into global equity markets and the region in particular, coupled with still modest valuations and progressive upgrades to earnings forecasts all continue to underpin the Fund's rationale for a high exposure. Net inflows into emerging market equity funds have been some of the strongest in almost a decade and have been well spread across a number of markets. The Fund will continue to run high exposure while positive momentum prevails in economic growth and earnings and while valuations sit at healthy discounts to long term averages, all elements which are compelling underweight investors to progressively redirect capital into Asia, notably China. With regards to China the Fund is holding a high weighting so long as the upward momentum in earnings forecasts is supported by favorable economic momentum. Concern over possible policy tightening has some credence given the high levels of new credit finding its way into the economy and given the propensity of excessive new credit to find its way into speculative activities. This is the key domestic issue to monitor. The hedge against the Fund’s USD-linked exposure remains in place. While the hedge neutralizes currency movements in those markets in which it is employed, in February the overall strength in the currencies the fund invests in resulted in a net positive contribution from currency. |
| More Information | » View detailed profile of this fund |
