LIONGLOBAL FLEXI FUND

Transcription

1 For the half year ended (Unaudited) SEMI-ANNUAL REPORT A member of the OCBC Group Lion Global Investors Ltd 65 Chulia Street #18-01 OCBC Centre, Singapore T: F: Co Reg No: D For more information, visit: lionglobalinvestors.com or ContactUs@lionglobalinvestors.com Lion Global Investors Limited. All rights reserved.

2 DIRECTORY Managers Lion Global Investors Limited 65 Chulia Street #18-01 OCBC Centre Singapore Directors of Lion Global Investors Limited Mr Ching Wei Hong (Chairman) Mr Christopher Brian Wei (Deputy Chairman) Mr Gerard Lee How Cheng (CEO) Mr Cheong Jin Keat Mr Yoon Mun Thim Mr Norman Ip Ka Cheung Mr Tan Siew Peng Mr George Lee Lap Wah Trustee/Registrar HSBC Institutional Trust Services (Singapore) Limited 21 Collyer Quay #10-02 HSBC Building Singapore Custodian The Hongkong and Shanghai Banking Corporation Limited 1 Queen s Road Central Hong Kong Independent Auditor PricewaterhouseCoopers LLP 8 Cross Street #17-00 PWC Building Singapore

3 PERFORMANCE OF THE FUND For the half-year ended Cumulative returns for the Fund are calculated up to in SGD terms, on a single pricing basis with dividends reinvested net of all charges payable upon reinvestment. Time Period Fund Returns (%) LionGlobal Flexi Fund SGD Class Benchmark Returns (%) (12-month SIBOR %) 3 months months year years* years* Since Inception* (3 April 2006) Cumulative returns for the Fund are calculated up to in USD terms, on a single pricing basis with dividends reinvested net of all charges payable upon reinvestment. Time Period Fund Returns (%) LionGlobal Flexi Fund USD Class Benchmark Returns (%) (12-month SIBID + 2.5%) 3 months months year years* years* Since Inception* (24 January 2007) *Returns of more than 1 year are annualised. 1

4 FUND AND MARKET REVIEW For the half-year ended, the Fund returned 1.0%, against the benchmark 12-Month Singapore Interbank Offer Rate % which returned 1.4%, in SGD terms. The year started with high expectations that strong US economic growth towards the end of 2013 would continue into. However, the severe winter in the US brought the economy to a standstill and, coupled with a slowdown in China, global equity market sold off whereas fixed income rallied. However, the equity market correction was shortlived as investors started looking past the weak US data in anticipation of a recovery in the second quarter. Chinese policymakers also reacted with targeted measures to stabilise growth. Despite the escalation of tensions between Russia and Ukraine, the market continued to grind higher. US economic data improved in the second quarter, with better-than-expected ISM (Institute of Supply Management) and payroll numbers. The US unemployment rate also fell to a post-crisis low of 6.1%. In Europe, the European Central Bank introduced easing measures in June by cutting deposit rates to negative levels and launching the Targeted Long Term Repurchase Operation (TLTRO) to counter deflationary pressures. China s growth stabilised as the government demonstrated commitment to its 7.5% target GDP (Gross Domestic Product) growth for with targeted easing. Over the review period, both equity and fixed income contributed positively to the Fund s performance, with the bulk of the returns coming through in the second quarter. High dividend stocks outperformed as interest rates declined. The Manager increased equity exposure in Japan, Hong Kong and Korea, as well as stocks that benefit from a global recovery and Chinese reforms in the second quarter, which added value to the Fund. Within the fixed income segment, both capital gains and coupon payments contributed to returns. 2

5 STRATEGY AND OUTLOOK The US economy has rebounded and recent economic data points to sustained economic momentum in the second half of. The Fed maintains its dovish stance and its recent messages suggest that they are in no hurry to hike rates or deviate from their accommodative monetary policies. However, improving job creation and higher inflation suggest that policy may need to be tightened in due course. We expect the Fed to communicate and guide the market on its future rate hike plans in their coming meetings. In Europe, the ECB (European Central Bank) has embarked on targeted longer-term refinancing operations, or TLTROs to encourage lending to certain areas of vulnerable economies to counter deflationary pressures. The ECB president has also signalled that policy makers are willing to act again if needed. Japan s recent positive economic data showed resilience despite the consumption rate hikes in April. We expect the Japanese market to be well supported by positive earnings revisions, government stimulus and pension fund buying. The Chinese economy has stabilised after a slow first half. Recent data points suggest that economic activity is picking up as easier credit for selected sectors and fiscal spending has also increased. SOE reforms and Hong Kong-Shanghai Stock Connect programme may be further catalysts for the markets. We favour an overweight in equities vs. bonds as we expect the broadening out of global economic growth to support equities. US and European equities appear fairly valued. On the other hand, valuations of Asian and Japanese equities are more attractive. Bonds have less upside, as strong economic data and/or increase in inflationary expectations should exert upward pressure on interest rates. We will keep the duration of the bond portfolio short as we expect carry and relative value to contribute to the bulk of returns. We maintain our allocation to lower end investment-grade credits in Singapore and Asia to enhance the yield of the portfolio. (as at 31 July ) 3

6 DISCLOSURES ON THE FUND 1 For the half year ended (Unaudited) 1. DISTRIBUTION OF INVESTMENTS AS AT 30 JUNE a) By Asset Class Percentage of total net assets attributable Fair Value to unitholders $ % Equities 1,050, Debt Securities (including accrued interest on debt securities) 2,709, Funds 3,511, Financial Derivatives 694 * Cash and cash equivalents 400, Net assets attributable to unitholders 7,672, b) By Credit Rating of Debt Securities A1 201, A2 259, Ba3 239, Unrated (Singapore - incorporated debt securities) 1,986, Accrued interest on debt securities 21, Total Debt Securities 2,709, c) By Derivative Type Foreign exchange forward contracts 57 * Futures contracts 367 * 424 * The net realised losses and unrealised gains at the end of the period were $36,756 and $694 respectively. * denotes amount less than 0.1% 1 As required by the Code on Collective Investment Schemes 4

7 2. TOP 10 HOLDINGS As at Percentage of total net assets attributable Fair Value to unitholders $ % LGlobal Funds - Asia High Dividend Equity 2,193, LionGlobal Asia Bond Fund 615, LionGlobal Japan Growth Fund 271, Sembcorp Industries Limited Series EMTN Var Perpetual 261, Standard Chartered Bank HK Series EMTN Var 27/10/ , Value Success International EMTN 4.125% Due 06/09/ , Far East Horizon Limited Series 4.25% Due 30/10/ , Capitaland Limited Series 2.95% Due 20/06/ , Tan Chong International Series EMTN 2.8% Due 09/01/ , Ezion Holdings Limited Series MTN 4.7% due 22/05/ ,

8 As at 2013 Percentage of total net assets attributable Fair Value to unitholders $ % LionGlobal Asia Bond Fund 1,406, LionGlobal Emerging Markets Bond Fund 329, Dah Sing Bank Limited Series EMTN 4.875% due 09/02/ , PCCW HKT Capital No4 Limited 5.75% due 17/04/ , Singapore Government Bond 2.75% due 01/07/ , DBS Bank Limited Singapore 4.7% Perpetual 252, Mapletree Logistics Trust Var Perpetual 251, LGlobal Funds - Asia High Dividend Equity 247, Ezion Holdings Limited Series MTN 4.7% due 22/05/ , SM Investments Corporation 4.25% due 17/10/ , RELATED PARTY TRANSACTIONS For the period from 1 January to $ Brokerage on purchases and sales of investments charged by a related company of the Managers 372 Interest expenses incurred with a bank which is a related company of the Trustee 59 Transaction fees charged by the Trustee 11,112 Registration fee charged by a related company of the Trustee 5,731 Valuation and administration fees charged by the Trustee 1,773 Custodian fees charged by a related company of the Trustee 2,997 Bank service fees charged by a bank which is a related company of the Trustee 1,120 Cash transfer fees charged by a related company of the Trustee 2,976 6

9 4. FINANCIAL RATIOS 2013 % % Expense ratio 1 (excludes underlying sub-funds expense ratio) Expense ratio 1 (includes underlying sub-funds unaudited expense ratios) Turnover ratio The expense ratio has been computed based on the guidelines laid down by the Investment Management Association of Singapore ( IMAS ). The calculation of the expense ratio at was based on total operating expenses of $139,030 ( 2013: $168,371) divided by the average net asset value of $8,112,422 ( 2013: $9,171,247) for the year. The total operating expenses do not include (where applicable) brokerage and other transactions costs, performance fee, interest expense, distribution paid out to unitholders, foreign exchange gains/losses, front or back end loads arising from the purchase or sale of other funds and tax deducted at source or arising out of income received. The Fund does not pay any performance fee. The average net asset value is based on the daily balances. 2 The expense ratio is the sum of the Fund s expense ratio and the underlying funds unaudited weighted average expense ratio of 0.61% ( 2013: 0.37%). 3 The portfolio turnover ratio is calculated in accordance with the formula stated in the Code on Collective Investment Schemes. The calculation of the portfolio turnover ratio was based on the lower of the total value of purchases or sales of the underlying investments, being purchases of $10,081,919 ( 2013: $6,959,458) divided by the weighted average daily net asset value of $7,948,685 ( 2013: $9,174,084). 5 GLOBAL EXPOSURE The global exposure relating to derivative instruments is calculated using the commitment approach by converting the derivative positions into equivalent positions in the underlying assets embedded in those derivatives. The global exposure of the Fund to financial derivative instruments or embedded financial derivative instruments will not exceed 100% of the net asset value of the Fund at any time. 7

10 6 COLLATERAL Nil 7 SECURITIES LENDING OR REPURCHASE TRANSACTIONS Nil 8 INVESTMENT IN OTHER UNIT TRUSTS, MUTUAL FUNDS AND COLLECTIVE INVESTMENT SCHEMES Percentage of total net assets attributable Fair Value to unitholders $ % LGlobal Funds - Asia High Dividend Equity 2,193, LionGlobal Asia Bond Fund 615, LionGlobal Japan Growth Fund 271, CSOP FTSE China A50 ETF 119, ishares Russell 2000 Growth ETF 80, Next Funds Topix 17 Real Estate ETF 78, Vanguard Industrials ETF 77, China ETF Series - Chinaamc CSI 300 Index ETF 75, BORROWINGS Nil 10 SOFT DOLLAR COMMISSION RECEIVED BY THE MANAGERS The soft dollar commissions from various brokers for the year were utilised on research and advisory services, economic and political analyses, portfolio analyses, market analyses, data and quotation analyses and computer hardware and software used for and in support of the investment process of fund managers. Goods and services received were for the benefit of the scheme and there was no churning of trades.these brokers also execute trades for other funds managed by the managers.the trades are conducted on best available terms and in accordance with best practices. 11 OTHER MATERIAL INFORMATION There is no other material information that will adversely impact the valuation of the Fund. 12 SUPPLEMENTAL INFORMATION ON UNDERLYING SUB-FUNDS Not applicable 8

11 STATEMENT OF TOTAL RETURN For the half year ended (Unaudited) For the half For the half year ended year ended 2013 $ $ Income Dividends 84,050 56,857 Interest on cash and bank balances Other income - 14,378 84,116 71,400 Less: Expenses Audit fee 8,777 8,681 Custodian fees 2, Management fee 49,366 56,302 Less: Management fee rebate (21,428) (10,069) Professional fees 9,446 8,956 Registration fee 5,731 4,526 Trustee fee 1,969 2,252 Valuation and administration fees 1,773 1,802 Transaction cost 35,697 26,516 Miscellaneous expenses 3,071 3,667 97, ,501 Net expense (13,283) (32,101) Net gains or losses on value of investments and financial derivatives Net gains on investments 156, ,214 Net gains/(losses) on foreign exchange forward contracts 6,132 (79,193) Net gains on foreign exchange spot contracts 888 2,840 Net losses on futures contracts (47,987) (706,049) Net gains/(losses) on options 4,905 (12,818) Net foreign exchange losses (2,657) (8,209) 117,453 (694,215) Total return/(deficit) for the period before income tax 104,170 (726,316) Less: Income tax (2,349) (838) Total return/(deficit) for the period 101,821 (727,154) 9

12 STATEMENT OF FINANCIAL POSITION As at (Unaudited) ASSETS As at As at 31 December 2013 $ $ Portfolio of investments 7,270,975 7,829,249 Receivables 51,994 37,902 Due from brokers 226,919 30,648 Financial derivatives at fair value 5,864 24,962 Cash and bank balances 423, ,121 Total assets 7,979,283 8,401,882 LIABILITIES Payables 51,941 47,676 Due to brokers 250,000 - Financial derivatives at fair value 5,170 14,484 Total liabilities 307,111 62,160 EQUITY Net assets attributable to unitholders 7,672,172 8,339,722 10

13 STATEMENT OF MOVEMENT OF UNITHOLDERS FUNDS For the half year ended (Unaudited) 31 December 2013 $ $ Net assets attributable to unitholders at the beginning of the financial period/year 8,339,722 9,372,940 Operations Change in net assets attributable to unitholders resulting from operations 101,821 55,015 Unitholders contributions/(withdrawals) Creation of units 224, ,767 Cancellation of units (993,796) (1,704,000) Change in net assets attributable to unitholders resulting from net creation and cancellation of units (769,371) (1,088,233) Distribution - - Total decrease in net assets attributable to unitholders (667,550) (1,033,218) Net assets attributable to unitholders at the end of the financial period/year 7,672,172 8,339,722 11

14 STATEMENT OF PORTFOLIO As at (Unaudited) By Industry (Primary) Percentage of total net assets attributable to Holdings at Fair value at unitholders at $ % QUOTED FUNDS LGlobal Funds - Asia High Dividend Equity 186,416 2,193, LionGlobal Asia Bond Fund 498, , LionGlobal Japan Growth Fund 250, , CSOP FTSE China A50 ETF 86, , ishares Russell 2000 Growth ETF , Next Funds Topix 17 Real Estate ETF , Vanguard Industrials ETF , China ETF Series - Chinaamc CSI 300 Index ETF 17,200 75, ,511, QUOTED EQUITIES BASIC MATERIAL Posco , Jiangxi Copper Company Limited H Shares 37,000 72, Lotte Chemical Corporation , , INDUSTRIAL PACC Offshore Services Holdings Private Limited 73,000 82, Hutchison Port Holdings Trust 88,000 78, Mitsubishi Electric Corporation 3,000 46, ,

15 Holdings at Fair value at $ Percentage of total net assets attributable to unitholders at % FINANCIAL Mapletree Greater China Commercial Trust REIT 86,000 74, AIA Group Limited 10,000 62, , ENERGY PetroChina Company Limited H Shares 62,000 97, SPT Energy Group Inc Company Ltd 38,000 24, , CONSUMER, CYCLICAL Li & Fung Limited 30,000 55, Hyundai Motor Company Limited , , REAL ESTATE Hongkong Land Holdings Limited 8,000 66, CapitaLand Limited 12,000 38, , CONSUMER, NON-CYCLICAL Sinopharm Group Company Limited H Shares 23,200 80, TECHNOLOGY Venture Corporation Limited 9,000 69, UNQUOTED BASIC MATERIAL China Forestry Holdings Limited* 448,

16 Holdings at Fair value at $ Percentage of total net assets attributable to unitholders at % CONSUMER, CYCLICAL Octaviar Limited* 63, China Hongxing Sports Limited* 802, FINANCIAL Rreef China Commercial Trust REIT* 500, FUNDS Fairfield Sentry Limited* TOTAL EQUITIES AND FUNDS 4,561, * These securities have been suspended from trading prior to current financial period and their fair value represents the Manager s best estimates. 14

17 QUOTED DEBT SECURITIES Holdings at Fair value at $ Percentage of total net assets attributable to unitholders at % REAL ESTATE Capitaland Limited Series 2.95% due 20/06/ , , Poly Property Group Co Limited 4.75% due 16/05/ , , Central China Real Estate Limited 6.5% due 04/06/ , , Hong Kong Huafa Invest H Shares 4.25% due 18/06/2017 1,000, , , FINANCIAL Standard Chartered Bank HK Series EMTN Var 27/10/ , , Value Success International EMTN 4.125% due 06/09/ , , Far East Horizon Limited Series 4.25% due 30/10/ , , , INDUSTRIAL Sembcorp Industries Limited Series EMTN Var Perpetual 250, , CONSUMER, CYCLICAL Tan Chong International Series EMTN 2.8% Due 09/01/ , , ENERGY Ezion Holdings Limited Series MTN 4.7% due 22/05/ , ,

18 Holdings at Fair value at $ Percentage of total net assets attributable to unitholders at % COMMUNICATION China Unicom Hong Kong Limited Series EMTN 4% due 16/04/2017 1,100, , Accrued interest receivable on debt securities 21, TOTAL DEBT SECURITIES 2,709, Portfolio of investments 7,270, Other net assets 401, Net assets attributable to unitholders 7,672,

19 By Industry (Summary) Percentage of total net assets attributable to unitholders at 31 December 2013 % % Funds Real Estate Financial Industrial Energy Consumer, Cyclical Basic Materials Communications Consumer, Non-cyclical Technology Utilities Accrued interest receivable on debt securities Portfolio of investments Other net assets Net assets attributable to unitholders

20 STATEMENT OF PORTFOLIO As at (Unaudited) By Geography (Secondary) Percentage of total net assets Fair value at attributable to unitholders at 31 December 2013 $ % % Luxembourg 2,193, Singapore 2,038, China 1,376, Hong Kong 887, Japan 395, South Korea 199, United States of America 158, Philippines Australia Indonesia Taiwan Malaysia Thailand Germany ,249, Accrued interest receivable on debt securities 21, Portfolio of investments 7,270, Other net assets 401, Net assets attributable to unitholders 7,672,

21 Disclaimer This publication is for information only. It is not an offer or solicitation for the purchase or sale of any securities/investments and does not have regard to your specific investment objectives, financial situation or particular needs. All applications for units in our funds must be made on application forms accompanying the prospectus. You should read the prospectus, available from Lion Global Investors Limited ( Lion Global Investors ) or any of its approved distributors, before deciding whether to subscribe for or purchase units of the Fund. Investments in the Fund are not obligations of, deposits in, guaranteed or insured by Lion Global Investors or any of its affiliates and are subject to investment risks including the possible loss of the principal amount invested. The value of units in the Fund and the income accruing to the units, if any, may rise or fall. Past performance, as well as any prediction, projection, or forecast on the economy, securities market, or the economic trends of the markets are not necessarily indicative of the future or likely performance of the funds. Any opinion or view presented is subject to change without notice. Accordingly, no warranty is given and no liability is accepted for any loss arising directly or indirectly as a result of you acting on any information, opinion, forecast, or estimate contained herein. You may wish to seek advice from a financial adviser before making a commitment to purchase the Fund. In the event that you choose not to seek advice from a financial adviser, you should consider carefully whether the Fund is suitable for you. Lion Global Investors, its related companies, their directors and/or employees (collectively known as Related Persons ) may have positions in the products mentioned in this publication. Lion Global Investors and its Related Persons may be engaged in purchasing or selling the products mentioned in this publication for themselves or their client. Lion Global Investors does not take into consideration the tax implications of the income earned as the tax position of each person is different. You are advised to seek independent tax advice on your personal tax position arising from investing in the product in question. Lion Global Investors Limited. All rights reserved. Lion Global Investors Limited is a Singapore incorporated company, and is not related to any corporation or trading entity that is domiciled in Europe or the United States (other than entities owned by its holdings companies). This publication may be translated into the Chinese language. In the event of any ambiguity, discrepancy or omission between the English and Chinese versions, the English version shall apply and prevail. In the event of any ambiguity, discrepancy or omission between this publication and the prospectus, the contents of the prospectus shall apply and prevail.

22 A member of the OCBC Group Lion Global Investors Ltd 65 Chulia Street #18-01 OCBC Centre, Singapore For more information, visit: lionglobalinvestors.com or Co Reg No: D