Phillip Global Opportunities Funds - Global Opportunities Fund. Semi Annual Report For the period ending 30 September 2015

Transcription

1 Phillip Global Opportunities Funds - Global Opportunities Fund Semi Annual Report For the period ending 30 September 2015

2 CONTENTS Page Directory 2 Manager s Investment Report 3 Report to Unitholders 4 Statement of Total Return 10 Statement of Financial Position 11 Statement of Movement in Unitholders Funds 12 Statement of Portfolio 13 Important information 17 1

3 MANAGER Phillip Capital Management (S) Ltd 250 North Bridge Road #06-00 Raffles City Tower Singapore (Company Registration Number: W) DIRECTORS OF THE MANAGER Lim Hua Min Loh Hoon Sun Jeffrey Lee Chay Khiong Linus Lim Wen Sheong Lee Ken Hoon TRUSTEE & REGISTRAR HSBC Institutional Trust Services (Singapore) Limited 21 Collyer Quay #13-02 HSBC Building Singapore CUSTODIAN The Hongkong & Shanghai Banking Corporation 1 Queen s Road Central Hong Kong AUDITORS KPMG LLP 16 Raffles Quay #22-00 Hong Leong Building Singapore SOLICITORS TO THE MANAGER Chan & Goh LLP 50 Craig Road #03-01 Singapore SOLICITORS TO THE TRUSTEE Drew & Napier LLC 10 Collyer Quay #10-01 Ocean Financial Centre Singapore

4 Manager s Investment Report Over the half-year period from 31 March 2015 to 30 September 2015, there was much volatility with the equity markets strong in the early part of calendar year 2015, and then faltering dramatically from August 2015 onwards. Equity markets were almost unanimously negative over this period. The MSCI World total return index for global equities was down 4.8% while the MSCI Emerging Market total return index for emerging market equities was down 14.3% in SGD terms. Commodities as measured by the CRB index was down 5.2%. Bonds did better, in large part due to the strengthening of the US dollar, which was up 3.7% versus the Singapore dollar over this period. Corporate bonds were up 1.2% as measured by the Citigroup WorldBIG Corporate Bond Index, while government bonds as measured by the Citigroup World Government Bond Index were up 3.8% in SGD terms. The Fund, as a balanced portfolio of bonds and equities, dropped 4.9% for the above half-year period. Markets were generally range-bound between March to July, as markets consolidated the gains made from the rebound starting from early 2015, which in turn was driven by bargain buying from the market correction in late There was also support from many central banks which were cutting interest rates to buoy domestic growth, with Europe in particular announcing the launch of a huge bond-buying program, the European version of quantitative easing. However, from August 2015 onwards, there was a wave of selling of equities in Asia-Pacific and emerging markets, which eventually also spread to developed markets. This was triggered by growth concerns on the China economy, sparked by an unexpected (slight) devaluation of their currency, while their Purchasing Manager s Index flitted in and out of contraction territory throughout the year. Furthermore, there was the backdrop of uncertainty about possible US Federal Reserve rate hike in September. The mandate of the Fund provides for a balanced allocation between bonds and equities. Also, we have been positioned more defensively since mid-2015, adding bonds and also holding VIX ETFs (which gain in value when market volatility rises), after having taken some profit from the equity markets. Thus the Fund was less affected during the market drop between August to September, dropping only 1.9% within these two months. One of our key equity themes for the Fund --- to position for a strong US dollar --- also helped cushion performance as the US dollar strengthened over this period. However, going forward, we have increased allocation to equities following the market drop of the last few months. In the backdrop of well-entrenched pessimism about global growth, equity valuations have become very attractive after the broad-based market selldown. We are still convinced of the long-term growth potential of the Asia-Pacific region, and hence have taken the opportunity to increase equity exposure to this region. The key mitigating factor to an economic slowdown is policy support. The US Federal Reserve has signaled it will need to consider the state of emerging markets in its monetary policy decisions. This is important because a unilateral US rate hike decision will impact developing economies especially if growth is already slowing down in these regions. We also do not think China will have a hard landing, even though its growth is slowing down. Their central bank has lowered interest rates and bank reserve ratios repeatedly and the central government has the firepower to undertake major stimulus if it wishes to. Therefore in such a context, we have reversed our pessimistic stance and are inclined to be more sanguine in our positioning. 3

5 Report to unitholders 1 a) I Investments classified by geography By Geography (Summary) Net Assets Attributable to Fair Value at Unitholders at 30/09/ /09/2015 S$ % Hong Kong 227, Ireland 2,112, Luxembourg 188, Singapore 732, South Korea 86, United States of America 1,787, Portfolio of investments 5,135, Other net assets 111, Net assets attributable to unitholders 5,247, a) II Investments classified by industry By Industry (Summary) Net Assets Attributable to Fair Value at Unitholders at 30/09/ /09/2015 S$ % Oil & Gas 80, Real Estate Investment Trust Unit Trust 5,055, Portfolio of investments 5,135, Other net assets 111, Net assets attributable to unitholders 5,247, As required by the Code on Collective Investment Schemes 4

6 a) III Investments classified by asset class Net Assets Attributable to Fair Value at Unitholders at 30/09/ /09/2015 S$ % Quoted Shares 80, Real Estate Investment Trusts Unit Trusts 5,055, Portfolio of investments 5,135, Other net assets 111, Net assets attributable to unitholders 5,247, b) Top Ten Holdings Net Assets Attributable to 10 Largest Holdings at 30 September 2015 Fair Value at 30/09/2015 Unitholders at 30/09/2015 S$ % Vanguard Short Term Bond ETF 809, Fullerton Asian Bond Fund 731, ishares Markit iboxx High Yield Corp Bond Fund ETF 725, ishares Global Corporate Bond UCITS ETF 622, ishares MSCI AC Far East Ex-Japan ETF 482, ishares MSCI Japan USD-H-A 282, ishares S&P Global Healthcare Sector Index Fund 201, DB X-Trackers FTSE Vietnam ETF 188, ishares Hedged MSCI Germany ETF 178, ishares Dow Jones US Financial Sector Index Fund ETF 165,

7 Net Assets Attributable to 10 Largest Holdings at 30 September 2014 Fair Value at 30/09/2014 Unitholders at 30/09/2014 S$ % UOB United SGD Fund 1,666, ishares Markit iboxx High Yield Corp Bond Fund ETF 1,082, ishares MSCI AC Far East Ex-Japan ETF 809, Phillip Money Market Fund 800, Fullerton Asian Bond Fund 611, ishares Euro Stoxx 50 ETF 512, ishares MSCI Emerging Markets ETF 450, Woori Kosef 200 ETF 381, Aviva Investor Sicav Global High Yield Bond Fund 327, DB X-Trackers FTSE Vietnam ETF 293, c) (i) Exposure to Derivatives 30 September Nil c) (ii) Gains on derivative contracts realised for the period from 1 April 2015 to 30 September 2015 Nil c) (iii) Gains on outstanding derivative contracts marked to market 30 September 2015 Nil d) Description of the method used to calculate the global exposure of financial derivatives The global exposure relating to derivative instruments is calculated using the commitment approach. The global exposure of the sub-fund is calculated as the sum of: (i) the absolute value of the exposure of each individual financial derivative not involved in netting or hedging arrangements; (ii) the absolute value of the net exposure of each individual financial derivative after netting or hedging arrangements; and (iii) the sum of the values of cash collateral received pursuant to: (a) the reduction of exposure to counterparties of OTC financial derivatives; and (b) efficient portfolio management techniques relating to securities lending and repurchase transactions, and that are reinvested. e) Amount and percentage of total fund size invested in other unit trusts, mutual funds and collective investment schemes 30 September S$ % Real Estate Investment Trusts Unit Trusts 5,055,

8 f) Amount and percentage of borrowings of total fund size 30 September Nil g) Amount of redemptions and subscriptions for the period from 1 April 2015 to 30 September Total amount of redemptions S$ 2,003,915 Total amount of subscriptions S$ 1,097,310 h) Amount of related party transactions for the period from 1 April 2015 to 30 September 2015 Interest income received from a related party of the Trustee S$1 Bank balances held with a related party of the Trustee S$391,249 Amounts held with a related party of the Manager S$63,005 i) Performance of the Fund 30 September months 6 months 1 year 3 years Since Inception 1 August 2011 Cumulative return -2.04% -4.87% 0.75% 5.88% 5.56% Annualised return % 1.92% 1.31% * Returns are in Singapore dollar calculated on a bid-to-bid basis, with net dividends reinvested. Source: Bloomberg j) Expense Ratio Total operating expenses S$ 213, ,523 Average daily net asset value S$ 6,573,261 11,243,899 Prorated expense ratio of the underlying funds (*) % Expense ratio (*) % The expense ratio has been computed based on the guidelines laid down by the Investment Management Association of Singapore ("IMAS"). In the case of funds of funds, which are generally defined as funds with more than 50% of their total assets in other underlying funds, a summarised expense ratio of the target funds and the fund of funds is calculated as of the closing date of the financial year. This corresponds to the sum of: The prorated ratio of the individual target funds, weighted according to the share they represent in the assets of the fund of funds as of the closing date, and; 7

9 Expense ratio of the fund of funds minus any rebates of management fees and commissions received from the target funds during the reporting period. 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. k) Turnover Ratio Lower of total value of purchases or sales S$ 5,097,639 9,603,342 Average daily net asset value S$ 6,573,261 11,243,899 Turnover ratio % 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 total value of purchases (or sales) of the underlying investments divided by the weighted average daily net asset value. l) Any material information that will adversely impact the valuation of the scheme such as contingent liabilities of open contracts. Nil. m) For schemes which invest more than 30% of their deposited property in another scheme, the following key information on the second-mentioned scheme ( the underlying scheme ) should be disclosed as well. (i) Top 10 holdings at market value and as percentage of NAV 30 September 2015 Not applicable. (ii) Expense ratios for the period ended 30 September A footnote should state (where applicable) that the expense ratio does not include brokerage and other transaction costs, performance fee, foreign exchange gains/losses, front or back end loads arising from or arising out of income received. Not applicable. (iii) Turnover ratios for the period ended 30 September 2015 Not applicable. 8

10 n) Soft dollar arrangements The Manager is entitled to and intends to receive or enter into soft-dollar commissions or arrangements. The Manager will comply with applicable regulatory and industry standards on softdollars. The soft-dollar commissions which the Manager may receive include research and advisory services, economic and political analyses, portfolio analyses including valuation and performance measurements, market analyses, data and quotation services, computer hardware and software or any other information facilities to the extent that they are used to support the investment decision making process, the giving of advice, or the conduct of research or analysis and custodial service in relation to the investments managed for clients. The soft dollar credits utilised are not allocated on a specific client basis. The brokers also execute trades for other funds managed by the Manager. The Manager will not accept or enter into soft dollar commissions or arrangements unless such softdollar commissions or arrangements would, in the opinion of the Manager, assist the Manager in its management of clients funds, provided that the Manager shall ensure at all times that transactions are executed on the best available terms taking into account the relevant market at the time for transactions of the kind and size concerned, and that no unnecessary trades are entered into in order to qualify for such soft-dollar commissions or arrangements. The Manager does not, and is not entitled to, retain cash rebates for its own account in respect of rebates earned when transacting in securities for account of clients funds. During the period, soft dollar services received from each broker were investment research and publications, data and quotation services. Soft dollar services were received from the Manager s panel of brokers which executed transactions for the Fund and other funds managed by the Manager. 9

11 Statement of Total Return Period ended 30 September /09/ /09/2014 S$ S$ Income Dividends 56, ,448 Interest , ,501 Less: Expenses Management fees 42,453 76,585 Management fee rebate (1,367) (1,690) Trustee fees 10,228 10,228 Custody fees 810 1,478 Valuation fees 10,228 10,228 Transaction fees 6,517 9,177 Audit fees 10,027 10,027 Other expenses 19,923 20,294 98, ,325 Net (losses)/income (42,680) (3,824) Net gains or losses on value of investments and financial derivatives Net (losses)/gains on investments (214,621) 58,236 Net gains on financial derivatives - 27,543 Net foreign exchange losses (2,494) (13,110) (217,115) 72,669 Total (deficit)/return for the period before income tax (259,795) 68,845 Income tax (expense) (7,931) (2,455) Total return/(deficit) for the period after income tax before distribution (267,726) 66,390 10

12 Statement of Financial Position As at 30 September /09/ /03/2015 S$ S$ Assets Portfolio of investments 5,135,642 6,262,667 Sales awaiting settlement 147,026 - Receivables 29,544 42,548 Cash and cash equivalents 454, ,662 Total assets 5,766,466 6,537,877 Liabilities Payables 298, ,427 Purchase awaiting settlement 220,632 - Total liabilities 519, ,427 Equity Net assets attributable to unitholders 5,247,119 6,421,450 11

13 Statement of Movement in Unitholders Funds Period ended 30 September /09/ /03/2015 S$ S$ Net assets attributable to unitholders at the beginning of financial period/year 6,421,450 11,265,972 Operations Change in net assets attributable to unitholders resulting from operations (267,726) 482,266 Unitholders Contributions/(withdrawals) Creation of units 1,097, ,214 Cancellation of units (2,003,915) (5,947,002) Change in net assets attributable to unitholders resulting from net creation and cancellation of units (906,605) (5,326,788) Total decrease in net assets attributable to unitholders (1,174,331) (4,844,522) Net assets attributable to unitholders at the end of financial period/year 5,247,119 6,421,450 Units in issue 4,976,078 5,790,790 Net asset value per unit

14 Statement of Portfolio As at 30 September 2015 By Geography (Primary) Holdings Fair value total net assets attributable to unitholders 30/09/ /09/ /09/2015 S$ % Quoted Hong Kong Hang Seng Investment Index Funds Series H Share Index ETF ishare Asia Trust-iShare S&P BSE SENSEX India Index ETF 8, , ,600 86, , Ireland ishares Global Corporate Bond UCITS ETF 4, , ishares Markit iboxx High Yield Corp Bond 4, , Fund ETF ishares MSCI AC Far East Ex-Japan ETF 8, , ishares MSCI Japan USD-H-A 6, , ,112, Luxembourg DB X-Trackers FTSE Vietnam ETF 5, , , Singapore Fullerton Asian Bond Fund 486, , Mapletree Industrial Trust , South Korea Woori Kosef 200 ETF 3,062 86, ,

15 By Geography (Primary) Holdings Fair value total net assets attributable to unitholders 30/09/ /09/ /09/2015 S$ % United States of America Chevron Corporation Com , Guggenheim Shipping ETF 4,372 90, ishares Dow Jones US Financial Sector 1, , Index Fund ETF ishares Global Industrials E ETF 1, , ishares Hedged MSCI Germany ETF 5, , ishares S&P Global Healthcare Sector 1, , Index Fund ProShares VIX Short-Term Futures ETF 5, , Vanguard Short Term Bond ETF 7, , ,787, Portfolio of investments 5,135, Other net assets 111, Net assets attributable to unitholders 5,247,

16 By Geography (Summary) total net assets attributable to unitholders total net assets attributable to unitholders Fair value 30/09/ /09/ /03/2015 S$ % % Quoted Germany Hong Kong 227, Ireland 2,112, Luxembourg 188, Singapore 732, South Korea 86, United States of America 1,787, Portfolio of investments 5,135, Other net assets 111, Net assets attributable to unitholders 5,247,

17 By Industry (Secondary) total net assets attributable to unitholders total net assets attributable to unitholders Fair value 30/09/ /09/ /03/2015 S$ % % Quoted Oil & Gas 80, Real Estate Investment Trust Unit Trusts 5,055, Portfolio of investments 5,135, Other net assets 111, Net assets attributable to unitholders 5,247,

18 Important Information Global Opportunities Fund (the Sub-Fund ) is a sub-fund of Phillip Global Opportunities Funds (the Fund ), an open ended umbrella unit trust authorised under the Securities and Futures Act, Chapter 289, by the Monetary Authority of Singapore This document is published by Phillip Capital Management (S) Ltd, the manager of the Fund (the Manager ), for information only and it does not constitute a prospectus nor form part of any offer or invitation to subscribe for or to purchase, or solicitation of any offer to subscribe for or to purchase, any units in the Sub-Fund. All applications for units in the Sub-Fund must be made on the application forms accompanying the latest prospectus of the Fund (the Prospectus ). The information and opinions contained in this document have been obtained from public sources which the Manager believes to be reliable and accurate. However, no representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information and it should not be relied upon as such. Opinions included herein constitute the judgement of the Manager at the time specified and may be subject to change without notice, they are not to be relied upon as authoritative or taken in substitution for the exercise of judgment by any recipient and are not intended to provide the sole basis of evaluation of any investment. Neither the Manager nor the Fund, nor any of their respective associates, directors, officers or employees, accepts any liability whatsoever for any loss arising directly or indirectly from any use of this document or any information contained herein. Given the economic and market risks, there can be no assurance that the Sub-Fund will achieve its investment objectives. Investments in the Sub-Fund are not deposits or other obligations of, or guaranteed, or insured by the Manager or the distributors or their affiliates and are subject to investment risks, including the possible loss of the full principal amount invested. Returns may be affected by, among other things, the investment strategies or objectives of the Sub-Fund and material market and economic conditions. The value of the units and the income from them can fall as well as rise. Past performance is not necessarily indicative of the future performance of the Sub- Fund. This document should not be taken as a recommendation to buy or sell since it does not take into account the specific investment objectives, financial situation and the particular needs of any particular recipient of this document. Investors should seek advice from a financial advisor before purchasing units in the Sub-Fund. In any case, investors should read the Prospectus and consider the risks as well as suitability of the Sub-Fund before deciding whether to subscribe for units in the Sub-Fund. Copies of the Prospectus are available and may be obtained from the Manager. 17