Investment Objective

The constituent fund aims to focus investment into the Asia Pacific equity markets to produce returns that are related to those achieved on the major stock market indices of Asia Pacific. The constituent fund aims to have the flexibility to invest in bonds in a limited manner and to manage the volatility of returns in the short term.

Fund Details

Latest Fund Expense Ratio: 1.84%

Launch Date(dd/mm/yyyy): 10/01/2011

Unit Price: HKD 11.34

Fund Size: HKD 685.99M

Fund Commentary

Asia Pacific ex Japan retreated sharply over the first quarter of 2020. The spread of COVID-19 cases raised fears of a global contagion and concerns around its potential impact on economic activity spurred an indiscriminate sell-off across stock markets. A majority of economies in the region came to a standstill after their governments announced nation-wide lockdowns to control the spread of the virus. These containment measures will negatively impact economic growth, with pressure on both demand and supply. All country indices ended the period in negative territory. The portfolio outperformed the index and proved relatively resilient during the sell-off in regional equities. My consistent investment approach to focus on companies with robust balance sheets and free cash flows, as well as on companies with longterm growth prospects supported performance. At a stock level, Fisher & Paykel Healthcare upgraded its full-year guidance, driven by a surge in demand for respiratory humidifiers and consumables due to the outbreak. Another innovation-led position in CSL gained, as demand for flu vaccines remained strong amid the pandemic. Its results highlighted robust demand for plasma therapeutics. Jiangsu Hengrui Medicine also benefited from the tailwind for the health care sector. The exposure to Beijing Oriental Yuhong Waterproof Technology added value. The company arranged to resume production early at its factories and participated in waterproofing and antiseepage projects at Wuhan hospitals. Conversely, Oil Search undermined returns. Weakness in global oil prices prompted the company to suspend its discretionary spends and shelve its projects in a bid to preserve the value of its business.

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