Public South East Asia Select Fund (PSEASF)

FOR SELF-REFERENCING ONLY



PUBLIC MUTUAL BERHAD

FAQS for PUBLIC SOUTH-EAST ASIA SELECT FUND (PSEASF)





The Public South-East Asia Select Fund (PSEASF) is an aggressive equity fund that seeks to achieve capital growth over the medium- to long-term period by investing in a portfolio of investments in South-East Asia markets. Up to 70% of the fund’s NAV can be invested in selected regional markets which include Indonesia, Philippines, Singapore, Thailand, Vietnam and other approved markets. The issue price / NAV of PSEASF is at RM0.2500 per unit during the 21-day initial offer period of 2 October 2007 to 22 October 2007. During the offer period, a promotional service charge of 5.45% of NAV per unit is extended to the purchase of units of PSEASF by investors.


FAQS

Q1: Why invest in South-East Asia?

The South-East Asia region, grouped together under the Association of South-East Asian Nations (ASEAN) comprising Singapore, Indonesia, Thailand, Philippines, Malaysia, Myanmar, Vietnam, Laos, Brunei and Cambodia, is among the world’s fastest growing regions.

ASEAN has an estimated population of 573 million and its nominal Gross Domestic Product (GDP) growth has averaged 9.0% annually since 2000. In per capita GDP terms, ASEAN residents have enjoyed a nominal growth of 6.8% per annum over the past six years, exceeding the average global per capita nominal GDP growth of 5.4% per annum over the same period. (source: Bloomberg, September 2007)

The growth prospects for the ASEAN economies are robust given their strong trade surpluses, high savings rates and accommodative monetary policies with low real interest rates. The ASEAN economies are expected to show sustainable real GDP growth ranging from 4.5% to 8.4% for 2007/2008 as per Table 1.

Table 1: GDP Growth Forecast for Major ASEAN Economies



(%) 2007F 2008F
Vietnam 8.4 8.1
Indonesia 5.6 6.0
Singapore 6.2 6.0
Malaysia 6.0 5.8
Philippines 5.5 5.0
Thailand 4.8 4.5
Source: Bloomberg, September 2007

Q2: What is the track record of South East Asian economies?

The ASEAN economies had a combined nominal GDP of US$1.0 trillion in 2006. Due to higher exports growth, stronger agricultural production and resilient domestic demand, ASEAN’s real GDP grew by 6.0% in 2006, above the average growth over the previous 5 years. Domestic demand was propelled by higher employment and increased private investments. (source: World Bank/ Bloomberg, September 2007)

The ASEAN countries also enjoy high savings rates ranging from 26% to 46% of their GDPs. (source: Asian Development Bank/ Central Banks)


Q3: What is the historical return of the fund’s benchmark Index?

· PSEASF’s benchmark Index registered a total return of 83.9% and 155.7% respectively for the 3 years and 5 years period ended 31 August 2007.

Q4: What are the main features of PSEASF?



· PSEASF is an aggressive equity fund that seeks to achieve capital growth over the medium- to long-term period by investing in a portfolio of investments in South-East Asia markets.



· Up to 70% of the fund’s NAV can be invested in selected regional markets which include Indonesia, Philippines, Singapore, Thailand, Vietnam and other approved markets.



· Equity exposure: Generally range from 75% to 95% of its NAV.




Q5: What is the investment strategy for PSEASF?



PSEASF is actively managed to achieve long-term capital growth by investing in blue chips, index stocks and growth stocks listed on domestic and regional markets in South-East Asia.
The fund generally maintains equity exposures within a range of 75% to 95% against its NAV. The balance of the fund’s NAV will be invested in fixed income securities such as sovereign bonds, corporate debt and money market instruments to help generate returns.




Q6: What makes PSEASF attractive to prospective investors?



· The fund allows investors the opportunity to participate in the long-term growth potential of a diversified portfolio of blue chip stocks, growth stocks, fundamentally undervalued stocks and dividend stocks listed on domestic and regional markets in South-East Asia.






Q7: What level of risks will we be looking at when investing in PSEASF?



As the fund generally maintains its equity exposure at 75% to 95% of its NAV, PSEASF may experience significant volatilities in times of adverse market movements. The fund manager will employ appropriate asset allocation, liquidity management, diversification and hedging strategies to manage the risks.



The fund’s investments in foreign markets will be monitored to ensure that the potential returns are commensurate with the risks incurred as a result of investing abroad. To mitigate risks arising from factors which include foreign currency exposure and foreign interest rate movements, the fund may employ hedging strategies to manage the risks posed to the fund.




Q8: Who will be most suited to invest in PSEASF?



· Investors who are optimistic with the growth prospects of South-East Asia countries and wish to diversify their investment into selected regional markets which include Indonesia, Philippines, Singapore, Thailand, Vietnam and other approved markets.



· It is also suitable for existing and prospective investors who have aggressive risk-reward temperament seeking medium- to long-term capital growth.




Q9. Is this fund open to EPF members via the EPF Members Investment Scheme?



No.

Q10: What is the selected Performance Benchmark for PSEASF?



The benchmarks of the fund and their respective percentages are as follows:
35% Straits Times Index (STI)
30% Kuala Lumpur Composite Index (KLCI)
15% Jakarta Composite Index (JCI)
15% Stock Exchange of Thailand Index (SET)
5% Philippine Stock Exchange Index (PSEi)




Q11: When is PSEASF going to be launched?



2 October 2007




Q12: What is the fund objective?



· To achieve capital growth over the medium- to long-term period by investing in a portfolio of investments in South-East Asia markets.






Q13: What is the issue price / NAV? And when is the initial offer period?



The issue price / NAV is RM0.2500 per unit during the 21-day initial offer period from 2 October 2007 to 22 October 2007.




Q14: What is the approved fund size of PSEASF?



The approved fund size for PSEASF is 1.5 billion units.




Q15: Please tell us the service charge and the annual management fee involved when investing in PSEASF? Is there any repurchase charge?



· During the offer period from 2 October 2007 to 22 October 2007, the service charge is 5.45% of NAV per unit. After the offer period, the service charge is up to 6.5% of NAV per unit. The annual management fee is 1.5% per annum of the NAV.



· There is no repurchase charge.




Q16: What is the minimum initial investment and minimum additional investment of the fund?



The minimum initial investment is RM1,000 and minimum additional investment is RM100.


Please do not hesitate to contact Alvin Yeoh (mobile: 012 655 8710; email: alvinyeohkw@gmail.com) or Catherine Lee (mobile: 012 978 1868; email: lscctr@yahoo.com)