Category: Asset Management

AHAM Capital declares income distribution of RM1.11 billion

AHAM Asset Management Berhad (“AHAM Capital” or “the Company”) has declared a total income distribution of RM1.11 billion for the financial year 2024, spanning across a total of 89 wholesale and retail funds managed by the Company. These Funds encompass a diverse set of strategies and asset classes including equities, bonds, and mixed assets.

Anton Tan, Chief Officer of Product Solutions of AHAM Capital said, “We are delighted to reaffirm our commitment to delivering consistent income to investors with average distribution yield ranging between 4.0% – 8.0% across our funds. In 2024, our strategic positioning in Malaysian equities paid off, supported by strong market performance driven by policy reforms and a surge in foreign direct investments. Additionally, easing inflationary trends and interest rate cuts by the US Federal Reserve created a supportive backdrop for fixed income markets, contributing to the overall stability of our income strategies.”

Looking ahead to 2025, Anton adds, “As the global stage shifts under Trump’s new administration, alongside heightened geopolitical tensions and persistent currency volatility, the need for diversification is more critical than ever. Income strategies help provide a cornerstone for portfolio resilience by offering stability and capital preservation in an uncertain environment.

“While the pace of rate cuts may slow, and interest rates could remain higher-for-longer, the current environment still offers a rare window for income-seeking investors to lock-in higher yields today. We remain steadfast in our commitment to providing globally diversified solutions spanning different strategies, assets and currency classes to help our clients recalibrate and position for the year ahead.”

The Company’s Select and World Series funds delivered strong income distribution yields ranging from 4.0% to 8.0% across various asset classes and strategies. Notable highlights include the AHAM World Series – Income Fund, which achieved an impressive yield of 8.3% by capitalising on global income opportunities, while the AHAM Select SGD Income Fund and AHAM Select AUD Income Fund each recorded yield of 4.50%, offering investors the advantages of currency diversification. In the Shariah-compliant segment, the AHAM Aiiman Income Plus Fund and AHAM Aiiman Quantum Fund delivered competitive yields of 4.50% and 4.60%, respectively.

As at 31 December 2024, AHAM Capital’s total Assets Under Administration (AUA) stood at approximately RM89.0 billion, encompassing assets under management, investment advisory, and those under distribution.

February 4, 2025
SUNWAY REIT COMPLETES THE ACQUISITION OF SUNWAY KLUANG MALL IN JOHOR

Sunway REIT Management Sdn. Bhd., the Manager of Sunway Real Estate Investment Trust (“Sunway REIT”), is pleased to announce that Sunway REIT has, on 30 December 2024, successfully completed the acquisition of Sunway Kluang Mall (formerly known as Kluang Mall).

Sunway Kluang Mall is located in the heart of Johor, making it a strategic town connecting to major towns such as Johor Bahru, Muar, and Batu Pahat. It provides excellent connectivity to other parts of Peninsular Malaysia through major highways and railways. With a population of more than 320,000 and a potential of approximately 1 million additional population in central Johor, the Kluang district serves as a preferred retail and lifestyle destination in the region.

Sunway Kluang Mall is presently 99% occupied, with over 130 tenants. The retail mall offers a diverse array of retail offerings, including international and homegrown brands, food and beverage (F&B) outlets, as well as entertainment and lifestyle services. Anchored by Pacific Hypermarket & Department Store, the mall’s extensive offerings such as health and beauty services, cinema and bowling centre enhance the overall retail experience.

Sunway Kluang Mall is expected to be yield-accretive to Sunway REIT’s portfolio with an estimated initial Net Property Income (“NPI”) yield of 7%.

Clement Chen, the Chief Executive Officer of Sunway REIT Management Sdn. Bhd., commented, “We are pleased to end the year with the completion of another acquisition. This fortifies Sunway REIT’s portfolio as one of the leading REIT in Malaysia. We strategically expanded our presence in Johor, which is a high-growth state and magnet for investment.”

He added, “Building on Sunway’s strong brand and proven track record in retail management, we see opportunities to further enhance the mall through tenancy optimisation, proactive management, and asset enhancement initiatives (AEI) that greatly increases the property’s growth potential.”

January 6, 2025
Osaka Emerges as Asia’s Next Global Financial Hub with Groundbreaking Special Zone Initiative
Osaka has proposed a special zone framework utilising the government’s financial and asset management special zone programme to promote the concentration and enhancement of financial and asset management services alongside the development of growth sectors. The city is positioning itself to maximise its economic power and strategic location while harnessing the momentum of the Osaka-Kansai Expo 2025.

What are Japan’s Financial and Asset Management Special Zones?

In June 2024, the Financial Services Agency (FSA) designated four regions – Hokkaido, Tokyo, Osaka, and Fukuoka – as “Financial and Asset Management Special Zones.” This initiative aims to create a “virtuous cycle of growth and distribution” by accelerating capital flows through asset management reforms. These designated regions receive special regulatory exemptions and support measures to attract new domestic and international investments, fostering the development of both financial services and regional industries.

The Special Zones programme advances three key objectives:

1. Attracting domestic and international financial and asset management operators
- English-language administrative procedures (commercial registration, social insurance, etc.)
- Creating new residence status for foreign investors investing in startups
- Support for opening bank accounts for foreign nationals
2. Supporting regional growth industries through financial and asset management operators
- Easing investment regulations for bank groups’ specialized investment subsidiaries in startups
- Relaxing regulations on qualified investors who can invest in professional venture funds
3. Promoting and nurturing growth industries
- Promoting acceptance of overseas talent (GX, fintech, etc.) through the Highly Skilled Professional Points-based System
Beyond financial services, the programme implements regulatory reforms and operational initiatives encompassing business environments, living conditions, and target industries for investment.

Each of the four designated regions has established unique concepts and visions leveraging their distinct characteristics, promoting initiatives in collaboration with a broad range of stakeholders.

Osaka’s Strategic Vision and Implementation

The Global Financial City OSAKA strategy focuses on creating an environment where continuous innovation thrives, carrying forward the legacy of Expo 2025 into the future. It aims to implement regulatory reforms aligned with global standards to attract foreign investment and strengthen financial functions in the region. These efforts are being driven by the “International Financial City OSAKA Promotion Committee,” established in March 2021. The committee, which now comprises 40 organizations as of February 2024, represents a collaborative effort between industry, academia, and government institutions.

Future Outlook
The immediate focus is on attracting talent, businesses, and capital from Asia and worldwide while building a concentrated ecosystem of investment-ready startups. This initiative represents Osaka’s commitment to transforming into a major international financial center while fostering innovation and sustainable growth, as part of Japan’s broader strategy to enhance its financial markets through the Special Zones programme.
December 30, 2024
Pacific Trustees’ hosts inaugural National Conference of Trust to spur growth of the trust ecosystem

KUALA LUMPUR (October 25, 2024): Pacific Trustees Group International (Pacific Trustees), through its subsidiaries Pacific Trustees Berhad and Pacific Trustees Islamic Berhad, will be organising its first ever National Conference of Trust as it sets out to boost the development of the trust industry in Malaysia.

Themed “Successful Preservation of Wealth Across Multiple Generations’’, this landmark event will explore the pivotal role of trust as the bedrock of sustainable growth, ethical leadership, and effective governance in Malaysia.

The conference is an epic gathering of industry heavyweights and brilliant minds, as they seek to develop the trust industry and its relevant ecosystem.

“In an era marked by rapid technological advancements, complex global challenges, and increasing public scrutiny, the importance of trust in institutions, businesses, and governance has never been more critical. A thriving trust industry is an important component of the financial sector and will play a big role in enhancing nation building,” said Paul Cheah, Pacific Trustees Group Chairman.

“In conjunction with our 30 th anniversary this year, we wanted to make a big impact by bringing together all the key players in the trust ecosystem. Together, we can make a larger impact for our clients, customers and stakeholders, and this will in turn boost the national economy,” said Cheah.

With a distinguished line-up of high profile speakers, the conference is a fusion of thought-provoking discussions and groundbreaking ideas, with specific focus on key developments related to wealth preservation, estate planning and tax implications of tax structures.

Happening on November 12 at the MATRADE Exhibition and Convention Centre, the conference will feature knowledge matter experts such as Dato’ Sri Idris Jala, President and CEO of PEMANDU Associates; Datuk Iskandar Mohd Nuli, Executive Chairman cumCEOof Labuan IBFC Incorporated; and Dato’ Stewart Labrooy, Executive Chairman of AREAManagement Sdn Bhd and Chairman Alpha REIT Sdn Bhd.

Tan Sri Datuk Amar Steve Shim Lip Kiong, Chairman of Pacific Trustees Berhad and retired Chief Judge of Sabah and Sarawak, will present the welcoming address to the participants.

The Conference will serve as a platform for industry leaders, policymakers, legal experts, and stakeholders to engage in intellectual discourse, share best practices, and explore innovative strategies for wealth management, including wealth creation, preservation, and the strategic use of trust structures.

Other distinguished speakers include Dr Mari-Len Ngu, Managing Director and CEO, Global Private Clients, Pacific Trustees Labuan Limited; Syakh Ibrahim Ibn Muhammad, ShariahConsultant, Lote Tree Consultancy; Ho Sing Foong, Head of Equity & Commodity Derivatives, Maybank Investment Bank; Edward Cheah, Director and Head of Private Wealth Division, Pacific Trustees Berhad; Wai Ken Wong, Country Manager, Stash Away Malaysia; SamYeow, Associate Director, KPMG Malaysia; Andy Ng Yen Heng, President of Malaysian Financial Planning Council; Irene Yong, partner at Shearn Delamore; Manshan Singh, partner at Skrine; Istee Cheah, partner at Wong & Partners; Muhammad Aiman Mohamad Salmi, Director/Principal Consultant, Tawafuq Consultancy Sdn Bhd; and Ng Chung Yee, Technical Director, Liquidity Solutions Sdn Bhd.

Pacific Trustees is a 30-year-old award-winning regional trust company with presence in Kuala Lumpur, Singapore, Labuan and Hong Kong, and has provided trust services to more than 316 bonds and sukuk issuers in the market, with a total fund size of about RM697billion in nominal value.

Those interested to attend the conference can book their tickets at https://www.ticket2u.com.my/event/37719/national-conference-of-trust-successful- preservation-of-wealth-across-multiple-generations.

October 29, 2024
RHB ASSET MANAGEMENT UNVEILS ENHANCED INCOME STRATEGY TO CAPITALISE ON A TRANSFORMATIVE INVESTMENT ERA

KUALA LUMPUR – RHB Asset Management Sdn. Bhd. (“RHBAM”), a wholly-owned subsidiary of RHB Investment Bank Berhad, today unveiled its enhanced Asian Income strategy comprising RHB Asian Income Fund, RHB Asian Income Fund-SGD and RHB Asian Income Fund – Multi Currencies (herein referred to as “RHB Asian Income Funds”). This enhancement marks a significant evolution of RHBAM’s flagship product, which has maintained a successful track record for over 12 years.

The RHB Asian Income Funds feed into the Schroder Asian Income Fund (“Target Fund”), managed by Schroders Singapore (“Schroders”). The Target Fund features a more dynamic asset allocation strategy, with a broadened investment scope that now spans global and alternative assets, in addition to Asian multi-asset investments. This comprehensive diversification allows Malaysian investors to tap into broader growth opportunities while enjoying stable income and capital appreciation over the medium-to-long term, amid a rapidly evolving investment landscape.

The RHB Asian Income Funds’ income distribution policy is now more flexible, allowing for monthly income distribution. It targets a higher income distribution of 6% to 6.5% per annum1, a notable increase from the previous 4.0% to 4.5% per annum. This improvement is designed to offer flexibility and provide a more regular income stream, especially valuable in times of market volatility.

The enhancement aligns with the current economic environment, characterised by easing monetary policies and lower interest rates, which have brought dividends back into focus. Coupled with ongoing corporate reforms across Asian capital markets, these factors are poised to drive stronger investor confidence and favourable dividend outcomes over the medium term.

The Target Fund’s diversified strategic investment universe now extends beyond Asian multi-asset investments to include global and alternative asset classes, aiming to boost alpha generation and enhance yields by tapping into income and growth opportunities worldwide. With a balanced approach that combines income generation and capital growth, the RHB Asian Income Funds aims to deliver stability and long-term potential. Investors gain access to high-quality companies globally, positioning them to benefit from major growth themes such as artificial intelligence, which are reshaping the market landscape.

Today, RHBAM manages an extensive range of unit trust funds, wholesale funds, private retirement schemes and private mandates for Malaysian investors, both retail and sophisticated investors at large. Our range of investment solutions encompasses both conventional and Shariah-compliant, sustainability focused and thematic strategies to cater to the differing risk appetite for out investors. Our assets under management (AUM) is in excess of RM50bil, with the support of our clients, appointed distributors and our agency force. Our product offerings are distributed by our list of appointed Institutional Unit Trust Agents (IUTAs), Corporate Unit Trust Agents (CUTAs), agency force and through our very own online portal, RHBAM MyInvest. Investors are able to access the RHB Asian Income Funds through www.rhbgroup.com/myinvest.

Retail investors can participate in RHB Asian Income Fund with a minimum investment of RM100, making this diversified approach to income and growth accessible to a broad range of investors.

Chze How Ng, Managing Director and CEO of RHB Asset Management, said:
“At RHB Asset Management Sdn. Bhd., we are committed to delivering innovative investment solutions that meet the evolving needs of our clients. The enhanced Asian Income strategy are designed to provide consistent income and capital growth during volatile market cycles. We are optimistic that it will play an essential role in every investor’s portfolio. We are proud to continue our 12-year partnership with Schroders, leveraging their proven expertise to navigate this dynamic investment landscape.”

Lily Choh, Head of South Asia and CEO Singapore, Schroders, said:
“As we steer through an era of transformative change, we are delighted to partner with RHB Asset Management Sdn. Bhd. on the enhanced Asian Income strategy, which is exclusively designed to benefit from Asia’s burgeoning influence and pivotal trends driving growth. Schroders, as one of the largest offshore managers in Malaysia, combines our regional expertise with a global perspective to deliver income stability while tapping into the next wave of growth opportunities. Our robust and forward-thinking investment strategies are well-positioned to adapt to the rapidly evolving market landscape, making this fund an ideal addition for investors seeking to navigate the future with confidence.”

Schroders plc
Schroders is a global investment management firm with £773.7 billion (€912.6 billion; $978.1 billion) assets under management, as at 30 June 2024. Schroders continues to deliver strong financial results in ever challenging market conditions, with a market capitalisation of circa £6 billion and over 6,000 employees across 38 locations. Established in 1804, the founding family remains a core shareholder, holding approximately 44% of Schroders’ shares.

Schroders has benefited from a diverse business model by geography, asset class and client type. It offers innovative products and solutions across four core businesses; Public Markets, Solutions, Wealth Management and our private markets business Schroders Capital. Clients include insurance companies, pension schemes, sovereign wealth funds, high net worth individuals and foundations. Schroders also manages assets for end clients as part of its relationships with distributors, financial advisers and online platforms.

Schroders aims to provide excellent investment performance to clients through active management. It also channels capital into sustainable and durable businesses to accelerate positive change in the world. Schroders’ business philosophy is based on the belief that if we deliver for clients, we will deliver for our shareholders and other stakeholders.

About the RHB Banking Group
The RHB Banking Group, with RHB Bank Berhad as the holding company, is one of the largest fully integrated financial services group in Malaysia. The Group’s core businesses are structured into five main business pillars, namely Group Community Banking, Group Wholesale Banking, Group Shariah Business, Group International Business, and Group Insurance.

Group Community Banking comprises Retail Banking and SME Banking, while Group Wholesale Banking comprises Group Investment Banking, Group Corporate Banking, Group Treasury & Global Markets, Group Asset Management, Commercial Banking, Transaction Banking, and Economics.
All five Strategic Business Groups offer their financial solutions through RHB Bank Berhad and its main subsidiaries – RHB Investment Bank Berhad, RHB Islamic Bank Berhad and RHB Insurance Berhad, while its asset management and unit trust businesses are undertaken by RHB Asset Management Sdn. Bhd. and RHB Islamic International Asset Management Berhad.

The Group’s regional presence now spans seven countries including Malaysia, Singapore, Indonesia, Thailand, Brunei, Cambodia, and Lao PDR.

October 22, 2024
Pavilion REIT Concludes Acquisition Of Pavilion Bukit Jalil, Reinforcing Retail Portfolio

Pavilion Real Estate Investment Trust (“Pavilion REIT”) has announced the successful conclusion of the acquisition of Pavilion Bukit Jalil, strengthening its position in the retail sector and marking an important milestone in its portfolio expansion and income diversification strategy.

Following the fulfilment of all conditions precedent as set out in the earlier Sale and Purchase Agreement (SPA) and an oversubscription of its first private placement, Pavilion REIT now owns Pavilion Bukit Jalil, inheriting its balance sheet and revenues.

Dato’ Philip Ho, CEO Pavilion REIT Management Sdn Bhd

“The successful acquisition of Pavilion Bukit Jalil signals a strategic expansion in Pavilion REIT’s portfolio, bringing total asset under management to RM8.3 billion and the start of another new chapter for Pavilion REIT,” stated Dato’ Philip Ho, the Chief Executive Officer of Pavilion REIT Management Sdn Bhd.

Dato’ Philip added that Pavilion Bukit Jalil’s robust tenant strategy, combined with its role as the host of numerous local and international events, has successfully driven the mall’s occupancy rate to over 82% in a relatively short span, and that this positive momentum is expected to continue.

The mall’s diverse tenant mix has recently secured new brands particularly in the F&B space including BONCAFE @ HOME, Mixbowlicious, Noodleface Express, MOVON, CrunchCraze, 117 Coffee Bar by Psycoth, Superhero, and Xi Yu (喜鱼). Further adding to the unique experience, the mall also will welcome new concept outlets such as Iron House Cafe (铁皮屋) and JP & Co.

Dato’ Philip Ho highlighted that Pavilion Bukit Jalil’s energetic atmosphere, catering to diverse interests, is poised to solidify Pavilion Bukit Jalil’s positioning as a premier retail destination. By incorporating novel retail brands and concept stores, while hosting renowned exhibitions and events, the mall’s strategic vision supports a wider visitor and shopper base, making it an increasingly attractive proposition.

L’Occitane Hotel pop up

Pavilion Bukit Jalil has established itself as a preferred event destination, hosting various international and local pop-up exhibitions. The mall is currently hosting the world’s first L’Occitane Hotel pop up and ‘The World of Tim Burton Pop-Up Museum’, the first in South East Asia. Recently concluded events include the internationally acclaimed Van Gogh immersive experience and Demon Slayer: Kimetsu no Yaiba Total Concentration exhibition from Japan.

Pavilion Bukit Jalil will also soon play host to the Japan Expo Malaysia 2023, the biggest all-Japan event from August 18 to 20. The event is expected to draw enthusiasts for all things Japanese and will incorporate a number of zones including music, food, travel, arts, education, health and wellness, anime and cosplayers.

About Pavilion REIT

Listed on 7 December 2011, with the largest exposure to the retail sector by any listed Malaysian REIT, Pavilion REIT owns a RM6.0 billion portfolio based on appraised value, to which its most prominent asset is the Pavilion Kuala Lumpur Mall that is located in Bukit Bintang, Kuala Lumpur, Malaysia. Pavilion REIT is established with the principal investment policy of investing, directly and indirectly, in a diversified portfolio of income producing real estate used solely or predominantly for retail purposes (including mixed – use developments with a retail component) in Malaysia and other countries within the Asia-Pacific region. For more details, please visit www.pavilion-reit.com

About Pavilion REIT Management Sdn Bhd

Pavilion REIT Management Sdn Bhd is the manager of Pavilion REIT. Incorporated in Malaysia on 7 April 2011 with an issued and paid-up capital of RM5 million, it is 51% owned by Urusharta Cemerlang Development Sdn Bhd and 49% owned by Urusharta Cemerlang Project Corporation Sdn Bhd. The principal activity of the Manager is to manage and administer Pavilion REIT.

June 2, 2023
Here’s Why KAF Investment Won This Coveted Morningstar Award

Morningstar recently announced the winners for the 2023 Morningstar Fund Awards – Malaysia. Of the five awards given out, KAF Investment Funds Berhad won two.

Morningstar Category Awards Winner
Best Asia-Pacific Equity KAF Jade Fund
Best Malaysia Large-Cap Equity Fund KAF Core Income Fund

Congratulations to KAF Investment for winning the Best Asia-Pacific Equity award with KAF Jade Fund, and Best Malaysia Large-Cap Equity Fund with their KAF Core Income Fund.

Smart Investor had the opportunity to interview Chue Kwok Yan, Chief Executive Officer cum Chief Investment Officer, KAF Investment, to learn more about their winning funds.

Chue Kwok Yan, Chief Executive Officer cum Chief Investment Officer, KAF Investment

Smart Investor: Congratulations on winning the Morningstar Award! Can you share with us what the recipe for your success is?

Chue Kwok Yan: This is a very difficult question indeed, as there are so many critical ingredients required to win such a coveted award that it is difficult to describe in such a short space. At the most basic level though, we believe that the building block is our people. We have successfully assembled a group of very talented individuals who share the same vision and work ethics that operate seamlessly in a close-knit team.

The huge diversity of background in our team is also by design where each member is able to contribute different viewpoints that is useful in navigating the drastically different investing circumstances over the past few years. Collectively, these allow us to formulate the right strategies for each unique circumstance.

SI: What are the strategies that you used in 2022? How was the fund positioned to mitigate risks and optimise opportunities?

CKY: Even after having managed money over the extreme market conditions of the past few years would not have prepared portfolio managers for 2022. The simultaneous fall in asset prices made our job very difficult especially for long-only funds. Previous approaches were untenable, and we had to start from a clean slate.

The breakthrough came when we accepted the correlation in asset prices on the downside. We mitigated risk by decisively cutting high valuation stocks to a minimum and hid in value stocks. This helped us weather the downshift for most of the year while we were able to take positions from a bottom-up stock selection basis towards the 2H of 2022 that fortunately worked well for us.

SI: 2022 was a bad year for most investments; how has this affected your investment strategies for both the short- and long-term?

CKY: It is not just the bad year for investments in 2022 but the series of extraordinary events over the past few years that has made a lasting impression on us. In a sense it solidifies our approach that focuses on our core competency. It taught us there is no ‘one size fits all’ hence the need to discard biases and remain adept in facing every circumstance that is different.

We will need to evaluate every situation by its merit and formulate suitable approaches and strategies in our investment decision making process.

SI: The recession is expected to hit us this year. What are your plans and strategies for 2023? Is there anything you plan to do differently?

CKY: Investment is a perennial process and hence 2023 is really a continuous window for making the most appropriate decision for maximizing returns while minimizing risks. In this sense, recession is just a blip in the investment journey requiring more focus on managing risk. We are fortunate that 2023 has started well for us with our funds posting relatively strong gains thus far.

Therefore, this gives us better flexibility in our strategies, allowing us to be more selective in our stock picks on higher conviction calls rather than constantly trying to catch up in performance by moving down the riskiness scale. We will dig deep into our core competency, as always, and focus on our competitive advantage in managing our esteemed clients’ money.

SI: With high inflation and interest rates, what’s your advice for retail investors?

CKY: The current episode of high inflationary pressure has laid bare a key shortfall in retirement planning and driven home the key message in pension weakness. Prior to this, each productive working individual is already facing inadequate pension due to longer life expectancy.

Compounding the effect is high inflation that erodes the real value of retirement funds with each Ringgit having lower purchasing power ability. In order to counter these effects, each working person would need to either work longer by retiring later or save more. Unfortunately, not everyone has the choice of the former with the statutory retirement age of 60 in Malaysia while not everyone has the luxury to save more.

As such, we advise all investors to make their retirement fund sweat for better returns that at the minimum compensates for inflation. Hence choose a fund base on knowledge of the Portfolio Manager who is managing it and stay invested all the time!

March 16, 2023
Congratulations To AmanahRaya Investment For Winning Two Morningstar Awards

Morningstar recently announced the winners for the 2023 Morningstar Fund Awards – Malaysia. Of the five awards, AmanahRaya Investment Management Sdn Bhd won two.

Morningstar Category Awards Winner
Best Malaysia Bond Fund AmanahRaya Unit Trust Fund (ARUTF)
Best Malaysia Bond (Shariah) Fund AmanahRaya Syariah Trust Fund (ARSTF)

Congratulations to AmanahRaya Investment for winning the Best Malaysia Bond Fund award with the AmanahRaya Unit Trust Fund (ARUTF), and Best Malaysia Bond (Shariah) Fund with the AmanahRaya Syariah Trust Fund (ARSTF).

Smart Investor had the opportunity to interview Mohamad Shafik Bin Badaruddin, Managing Director / Chief Executive Officer, AmanahRaya Investment to learn more about their winning funds.

Mohamad Shafik Bin Badaruddin, Managing Director / Chief Executive Officer, AmanahRaya Investment

Smart Investor: Congratulations on winning the Morningstar Award! Can you share with us what the recipe for your success is?

Mohamad Shafik: Thank you. Our accomplishment is due to a combination of factors. Our recipe is founded on a disciplined approach to managing investments, stringent credit checks, strict risk management, and a focus on giving our investors strong and consistent returns. In addition, we prioritise establishing long-term relationships with our clients by providing them with clear, as well as timely communication.

Our team of seasoned investment professionals works closely to identify opportunities in the market and manage risk in a controlled manner. As we navigate the market, we constantly learn and adapt to the changes in the market and the economy, which we believe will enable us to stay ahead of the ‘game’.

SI: What are the strategies that you used in 2022? How was the fund positioned to mitigate risks and optimise opportunities?

MS: Our strategies for 2022 involved a focus on high-quality investments and a cautious approach to risk management. We positioned the fund defensively, with a bias towards shorter duration and higher credit quality bonds. However, we remain invested for most parts of the year and tried to play with allocation and diversification strategies as opposed to timing the market.

We were highly focused on building resilient portfolios that could withstand volatility and unexpected events, by diversifying across ratings, issuers and sectors. Overall, our approach was designed to balance risk and return, and to deliver consistent performance over the long term.

SI: 2022 was a bad year for most investments; how has this affected your investment strategies for both the short- and long-term?

MS: The macro landscape in 2022 was not very supportive of fixed-income investing, especially when central banks began to turn hawkish and tighten liquidity condition. The challenging landscape had reinforced the importance of having a strong investment discipline. While we did some adjustments to our investment strategies in response to changing market dynamics and conditions, our overall approach remained consistent with what we have been practising all these years.

In short, the prevailing market condition did not affect or change the way we do things at ARIM. The key is to have a plan upfront. Something along the line of – if the market does this, we do this, if otherwise, then we do this. After refining our strategies and listing down all the actionable ideas and probable outcomes, before executing, we always ask ourselves the question “what could go wrong”, just so to be aware of the risks to our strategies.

SI: The recession is expected to hit us this year. What are your plans and strategies for 2023? Is there anything you plan to do differently?

MS: We are monitoring the market and economic condition very closely. Having said this, we are in an ever ready state to change direction of our strategy if need be. If a recession happens – now that is a big ‘IF’, general we would expect bond prices to fall during a recession. Also, shorter tenure bonds would look more attractive compared with longer tenured ones.

In our view, the market is already discounting a mild recession in the U.S., Europe, as well as the UK, for 2023. As of now, it looks like central banks appear to be in control to engineer a soft landing with inflation slowing meaningfully by the end of 2023.

Given the scenario, we would maintain our current portfolio duration for the first half and revisit them with the view to possibly extend the duration slightly in the second half.

SI: With high inflation and interest rates, what’s your message for retail investors?

MS: Our message to retail investors is to keep invested, during good or bad times, and avoid market timing. While we are not against timing the market, doing it consistently is something that is very difficult to achieve based on industry experience in general.

It is also important for investors to work with financial advisors or unit trust agents who are able to advise them on how to asset allocate their monies into a diversified portfolio. Building a well-diversified portfolio across multiple asset classes is key to building wealth in the long run.

March 16, 2023
PMB Investment Wins Best Malaysia Large-Cap Equity (Syariah) Fund In The 2023 Morningstar Fund Awards Malaysia

Morningstar recently announced the winners for the 2023 Morningstar Fund Awards – Malaysia and PMB Investment Berhad emerged as one of the winners.

Morningstar Category Awards Winner
Best Malaysia Large-Cap Equity (Shariah) Fund PMB Shariah Tactical Fund

Congratulations to PMB Investment for winning the Best Malaysia Large-Cap Equity (Shariah) Fund award with their PMB Shariah Tactical Fund.

Smart Investor had the opportunity to interview Mahani Ibrahim, CEO of PMB Investment Berhad, to learn more about their winning funds.

Mahani Ibrahim, CEO of PMB Investment

Smart Investor: Congratulations on winning the Morningstar Award! Can you share with us what the recipe for your success is?

Mahani Ibrahim: The equity market’s performance last year was put under pressure by a combination of factors, such as rising inflation, interest rate hikes, the prospects of slower global growth, fears of a US recession, the Russia & Ukraine war, geopolitical events, supply chain disruptions and China’s zero-Covid policy.

In line with the market condition, the fund manager maintained the equities position around 70% to 82%. The fund manager was cautious about the equity market. The fund manager also adopted a trading strategy stance.

Last year, we focussed on non-traditional and essential businesses, export-oriented companies and ESG themes. Due to this approach, some of the stock selections contributed handsomely to the portfolios under our management.

SI: What are the strategies that you used in 2022? How was the fund positioned to mitigate risks and optimise opportunities?

MI: Last year’s asset allocation had a fair combination of core, dividend, growth and trading play. There was no significant re-balancing exercise as we practically held to our core and dividend stocks as we believed the companies had a potential upside.

However, the FM cut losses on some non-profitable stocks and replaced them with other companies we evaluated to have good potential. The fund manager maintained the cash level around 18% to 30%.

SI: 2022 was a bad year for most investments; how has this affected your investment strategies for both the short- and long-term?

MI: Throughout these challenging years, we emphasised stock picking to achieve outperformance. Besides, we used the “Buy on Weakness” approach if the market went down to a certain level and applied temporary defensive measures during adverse periods. We are more comfortable to raise cash and we are comfortable to be underperforming our peers and benchmark on short-term basis.

As our focus is our long-term performance, it is only natural that our performance to sway in the short-term basis due to the volatility.

SI: The recession is expected to hit us this year. What are your plans and strategies for 2023? Is there anything you plan to do differently?

MI: At the moment, we plan to stick to our approach as stated in Q3. However, we will be flexible on our strategy depending on the market and economic situation. Currently, we are focusing on defensive such as the consumer staples and quality yield play, energy (due to underinvestment in the recent years following the collapse of oil price), ESG themes and small and medium size companies with potential growth.

SI: With high inflation and interest rates, what’s your advice for retail investors?

MI: They should focus on the long-term value of their portfolio and avoid making poorly timed asset sales. Besides, they must be ready to withstand the short-term volatility of the equity market.

March 16, 2023

Morningstar Announces Winners for 2023 Morningstar Fund Awards Malaysia

KUALA LUMPUR, 16 March 2023 — Morningstar, Inc. (Nasdaq: MORN), a leading provider of independent investment research, today announced the winners for the 2023 Morningstar Fund Awards – Malaysia. The awards recognise those funds and asset managers that have served investors well over the long term and which Morningstar’s manager research team believes will be able to deliver strong risk-adjusted returns in the longer term.

The annual Morningstar Fund Awards recognise the retail funds and fund groups that added the most value for investors within key sectors and across asset classes. Morningstar selects the winners using a quantitative methodology, and eligible funds require a five-year performance track record. Weightings to one-, three-, and five-year performance are factored into the methodology, along with a qualitative overlay.

*Wing Chan, Head of manager research, Europe and Asia Pacific, Morningstar*

“The Morningstar Fund Awards commends funds and asset managers that served investors well by delivering top notch risk-adjusted performance for investors in 2022 and over longer time periods. Morningstar’s manager research team have used Morningstar’s extensive datasets and quantitative methodology to determine the winners across equity and fixed income categories, as the leading funds within Malaysia for investors,” said Wing Chan, Head of manager research, Europe and Asia Pacific, Morningstar.

The 2023 Morningstar Fund Award – Malaysia winners are:

Morningstar Category Awards	Winner
Best Asia-Pacific Equity	KAF Jade Fund
Best Malaysia Large-Cap Equity Fund	KAF Core Income Fund
Best Malaysia Large-Cap Equity (Shariah) Fund	PMB Shariah Tactical Fund
Best Malaysia Bond Fund	AmanahRaya Unit Trust Fund (ARUTF)
Best Malaysia Bond (Shariah) Fund	AmanahRaya Syariah Trust Fund (ARSTF)

Methodology

The Morningstar fund category and fund house awards are based on Morningstar fund data as of 31 December 2022. The awards methodology emphasises the one-year period, but funds must also have delivered strong three-year returns after adjusting for risk within the award peer groups in order to obtain an award. In selecting winners, fund returns are adjusted for risk using the Morningstar Risk, a measure which imposes a higher penalty for downside variation in a fund’s return than it does for upside volatility.

The full methodology for the awards is available here.

About Morningstar

Morningstar, Inc. is a leading provider of independent investment insights in North America, Europe, Australia, and Asia. The Company offers an extensive line of products and services for individual investors, financial advisors, asset managers and owners, retirement plan providers and sponsors, and institutional investors in the debt and private capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, debt securities, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with approximately $246 billion in assets under advisement and management as of Dec. 31, 2022. The Company operates through wholly- or majority-owned subsidiaries in 32 countries. For more information, visit www.morningstar.com/company. Follow Morningstar on Twitter @MorningstarInc.

March 16, 2023