KFCORE … CORE assets for every portfolio

20 October 2020

16 October 2020 - Krungsri Asset Management Company Limited has officially launched “Krungsri Global Core Allocation Fund (KFCORE)”, thanks to the strategic partnership between Krungsri Group and BlackRock, the world’s no. 1 largest asset management firm*. This partnership has become Krungsri’s unique privilege provided to Krungsri customers only. Talking about the investment strategy, KFCORE applies the Tactical Asset Allocation strategy that focuses on active and flexible portfolio rebalancing to maintain consistent returns in all market conditions. Thus, this fund can be applied as a core asset for long-term portfolio particularly in highly volatile market periods. The initial public offering period of KFCORE is 15 - 27 October 2020.

 
At a recent webinar on “Crafting the CORE...Creating the Unique Allocation”, Mr. Kiattisak Preecha-anusorn, Vice President for Alternative Investment, Krungsri Asset Management, and Mr. Eric Mueller, Multi-Asset Production Strategist for BlackRock were invited to provide and share information involving KFCORE’s portfolio management strategy, macroeconomic analysis for asset selection, risk management and expected fund performance for the sake of investors’ decision making data in main portfolio management for long-term investment.
 
Mr. Kiattisak said that as markets have currently confronted high risks and volatility, it’s hard for traditional investment to achieve swiftly rebalancing portfolio and of course to generate steady returns. But KFCORE is unique in its proactive investment strategy, the Tactical Asset Allocation that emphasizes on high flexibility, making the fund able to quickly rebalance portfolio at all time. Thus, investors do not need to time the markets themselves. The fund will invest in diverse assets in all regions around the world, focusing on quality equities and debt instruments, while rebalancing will be made to be in line with markets in each period to maintain stability of favorable, steady returns in all situations. 
KFCORE stands out in its strong position, given Krungsri partnership with BlackRock, the world’s largest fund management firm* that has managed over 2,000 funds with assets under management of over 7.8 trillion US dollar globally and their expertise in managing diverse assets worldwide. 
(Source: BlackRock as of 30 Sep. 2020 | BlackRock is the world’s largest fund management company, being cited from Statista.com as of 7 Jul. 2020. Such ranking is not relevant to AIMC’s ranking.)
 
Regarding the tactical asset allocation strategy, Mr. Mueller of BlackRock said that its Global Tactical Asset Allocation Team specializes in this type of investment. Besides, BlackRock deploys high-tech tools that assist in analyzing factors to seek investment opportunities, making KFCORE stand out in analyzing the macroeconomic factors to time the markets to generate returns and enhance portfolios’ stability and growth. So far, BlackRock has managed investment portfolios with a combined value of 33 billion US dollar in this kind. (Source: BlackRock as of 31 Dec. 2019)
 
According to Mr. Mueller, what makes BlackRock’s Tactical Asset Allocation strategy differ from others is its focus on flexibility to generate consistently attractive returns without too high-risk exposure. The fund prioritizes the macroeconomic analysis using Big Data as an analytics tool to analyze policy directions of global central banks and monetary policies in each country. Besides, such factors are taken into consideration on how each of them affects asset prices to find proper timing to invest. These tools allow systematic approach for portfolio rebalancing, while eliminating emotional effects to stabilize investment portfolios.

Source: BlackRock as of Aug. 2020 
 
Mr. Kiattisak said that the Tactical Asset Allocation strategy suits the current investment outlook that has high market volatility. Focusing on investment prospects in 3 to 12 months, KFCORE has seen market fluctuations as an opportunity for making investment in each type of assets in each market at a specific period to keep pace with fast-changing markets.  
One of the investment tools that the fund has applied mainly weigh on Exchange Traded Funds or ETFs that are assets with high liquidity, low cost, and transparency. Such characteristics suit the fund’s investment strategy that has focused on active portfolio rebalancing. Besides, the fund can also generate additional returns from investing in Active Funds under BlackRock’s management that has a coverage of assets around the globe. 
Source: BlackRock  as of Dec. 2019
 
Speaking about his view on markets, Mr. Mueller explained that although equities are risky assets, their growth opportunities exist. Thus, the fund has still maintained its equity investment at high levels, while merging markets in Asia, Japan and the United States still see opportunities to grow. Despite of the fund’s positive view toward Europe market, it remains sensitive to the COVID-19 crisis. Therefore, the Europe is currently underweighted. However, if the Europe signals a recovery sign with a growth opportunity, the fund’s position can be adjusted swiftly. For U.S. market, even though it has been seen as expensive, the fund will seek a chance for investment by reviewing the central banks’ monetary policies.
 
According to the above-mentioned views, Mr. Mueller explained more that, about 30 - 35% of the fund’s investment portfolio stay in equities, 65% in debt instruments and the remaining 5% cash. However, the allocation is flexible.  Equity exposure is historically ranged between 20% - 50%, depending on market conditions in each period. The rest will go to quality debt instruments.
 
Interested investors can purchase KFCORE through only Krungsri Asset Management and Bank of Ayudhya’s branches nationwide. The first purchase must be made at a minimum of 50,000 baht and the next purchase is 2,000 baht. Special promotion was also offered during IPO period (15 – 27 October 2020) only where every 100,000 baht of investment in this fund will earn 100 baht of KFCORE units. (when investing in compliance with terms and conditions set forth in this promotion)
 
Disclaimer
  • Please carefully study fund features, performance, and risk. Past performance is not a guarantee of future results.
  • KFCORE shall invest in the investment units of foreign mutual funds and/or exchange traded funds (ETFs) which have the investment policy to invest in equity instruments, bank deposits, debt instruments, hybrid instruments, commodities, alternative assets including foreign property funds and/or REITs, and/or infrastructure funds established or issued in countries worldwide. 
  • The fund has risk level at 5 - moderate to high risk.
  • The Fund may invest in fixed-income instruments of non - investment grade or unrated securities and may also invest in unlisted securities. Therefore, investors are subject to higher risk of not receiving their principal and interest payments that are due to them.
  • The Fund may enter into a currency swap within discretion of the Management Company which may incur transaction costs. The increased costs will reduce overall return. In absence of a currency swap, investors may lose or gain from foreign exchange or receive lower return than the amount initially invested.
 
For more information, please contact:
Krungsri Asset Management Co., Ltd Tel. 02-657-5757 or Bank of Ayudhya
 
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See details of KFCORE’s promotion Click
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