CIMB-Principal Launches Preferred Securities Fund for Income and Capital Appreciation
3 April 2017
Fund offers better risk-return profile amidst volatile market conditions
Kuala Lumpur: CIMB-Principal Asset Management Berhad (“CIMB-Principal”) today announced that it has launched the CIMB-Principal Preferred Securities Fund (“the Fund”). The Fund aims to achieve potential income and capital appreciation by investing in Principal Global Investors-Preferred Securities Fund (PGIPF) over the medium to long-term. PGIPF is a Dublin-based UCITS fund that invests primarily in a portfolio of USD-denominated preferred securities and debt securities.
Munirah Khairuddin, Chief Executive Officer of CIMB-Principal said, “Preferred securities potentially offer attractive yields, especially in an environment with low interest rates and heightened volatility. As a unique asset class, preferred securities share the characteristics of both equities and bonds, but exhibit a relatively low correlation to both traditional fixed income and equity categories. Therefore, by investing in the CIMB-Principal Preferred Securities Fund, investors could improve their overall portfolio risk-return profile.”
The CIMB-Principal Preferred Securities Fund invests in a portfolio of diversified preferred securities for potential income returns and long term capital preservation. CIMB-Principal expects a RM300 million subscription of the fund in 2017.
The PGIPF is expected to perform above its benchmark which is 50% Merrill Lynch Fixed Rate Preferred Securities Index and 50% Bank of America Merrill Lynch US Capital Securities Index. The fund provides a conservative, risk-managed approach to preferred securities, with at least 75% of assets in investment grade preferred securities with a required minimum average portfolio credit rating of BBB- or better.
The Fund is available in a multi-currency structure with a minimum initial investment of RM5,000 for investments in Ringgit (with minimum additional investment of RM2,000) and USD5,000 for investments in USD (with minimum additional investment of USD2,000). Investors can invest via consultants of CIMB-Principal (CWA), CIMB Private Banking, Kenanga Wealth and other participating banks.
CIMB-Principal has also recently launched two other funds – the CIMB-Principal Emerging Market Multi Asset Fund (EMMA) and CIMB-Principal Asia Pacific Dynamic Mixed Asset Fund (APDMA), for investors with a moderate risk profile. EMMA is benchmark-agnostic and holistically covers opportunities across equities, currencies and bonds in global emerging markets, including companies in developed markets that operate in emerging markets. APDMA on the other hand offers a unique proposition of dynamic asset allocation complemented by best stock picks to capture opportunities from equities and debt instruments as well as currency outlook.
To date, CIMB-Principal has a total of 63 unit trust funds (of which 19 are Shariah-compliant), 19 wholesale funds, 10 Private Retirement Scheme (PRS) funds and two exchange-traded funds (ETFs). The Company recently won fund performance awards by The Edge-Lipper Malaysia Fund Awards 2016 for the Best Overall Group, Best Equity Asia Pacific Ex-Japan for the 3 year and 5 year categories, Best Equity Global for the 3 year and 5 year categories as well as the Best Equity Asia Pacific Ex-Japan (Islamic) for the 3 year category. For the Morningstar Awards 2016 Malaysia, the Company bagged the award for Best Asia Pacific Equity Fund category. The company was also named the Best Fund House in Malaysia by AsianInvestor for its Asset Management Awards 2016, Best Asset & Fund Manager, Malaysia (2007-2016) by Alpha Southeast Asia for its 10th Annual Best Financial Institution Awards 2016 and Asset Management Company of the Year, Malaysia by The Asset Triple A for its Asset Servicing, Fund Management and Investors Awards 2016. As at 31 December 2016, CIMB-Principal Group had a total of RM67.6 billion in assets under management.
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