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DIY Investor Magazine
/
September 2016
Before investing in an investment trust referred to in this document, you should satisfy yourself as to its suitability and the risks involved, you may wish to consult a financial adviser.
The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.
Nothing in this document is intended to or should be construed as advice. This document is not a recommendation to sell or purchase any investment. It does not form part of any
contract for the sale or purchase of any investment.
Issued in the UK by Henderson Global Investors. Henderson Global Investors is the name under which Henderson Global Investors Limited (reg. no. 906355), Henderson Fund
Management Limited (reg. no. 2607112), Henderson Investment Funds Limited (reg. no. 2678531), Henderson Investment Management Limited (reg. no. 1795354), AlphaGen Capital
Limited (reg. no. 962757), Henderson Equity Partners Limited (reg. no.2606646), Gartmore Investment Limited (reg. no. 1508030), (each incorporated and registered in England and
Wales with registered office at 201 Bishopsgate, London EC2M 3AE) are authorised and regulated by the Financial Conduct Authority to provide investment products and services.
A Wholesale Change?
Thus far, the steps towards Asian equity income
have only been tentative. In Thailand 17% of the top
pension funds have assets in stocks, compared with
61% in Hong Kong, according to the Organisation for
Economic Cooperation and Development (OECD).
It is the demand potential from retail investors that could
be game-changing however: as a percentage of Gross
Domestic Product (GDP), China has a savings rate of
49% versus a world aggregate of 24%, a US rate of
18%, and 12% in the UK, according to the World Bank.
With China’s GDP at around $11trn, the savings portion
is eye-watering. And with savers receiving the same
lacklustre yields as institutional investors even a small
allocation switch has the potential to move significant
sums of cash into the equity markets. I
t paints a picture of potentially rampant domestic Asian
equity demand.
In our portfolios the strategy has been to aim to provide
a blend of income-yielding equities with lower yielding
equities with the potential for dividend growth.
We believe this mix - with improving corporate
governance and attitudes towards shareholder value
and dividend pay-outs - provides our investors the
opportunity to diversify their income stream away from
Western markets and gain exposure to the undeniable
change afoot in Eastern markets.
Questioning the Manager – Michael Kerley. Henderson Far East Income Trust
