Why AsiaPrint this page

Asia continues to command a significant presence in world economics and it is anticipated this will continue to grow over the coming decades. With the region accounting for half of the world’s population and GDP growth in Asia projected to remain positive, it is difficult to ignore the immense investment opportunity that Asia presents.

Asia's growth story comes from a number of highly interrelated factors. The three key areas to consider are:

1. The industrialisation of Asia

Industrialisation in Asia is focused on creating fields of excellence. This not only retains Asia’s high export levels and external demand for goods, it also generates wider benefits within the region:

• Shift from an ‘imitation’ to ‘innovation’ mentality – traditionally stereotyped as a region for producing low-cost copies, Asia is now redefining itself as a leader in high-end manufacturing and the services industry. Countries such as China and India are now major players in areas of science, technology and IT.
• Globally competitive companies – while their home economies may still be developing, many companies in Asia (Samsung and Tata Group (India) for example) are already market leaders. Businesses such as these pave the way for new companies in these regions.
• Movement to the cities – as more people move to the cities and businesses set up in major hubs, financial flows increase in these areas. To support this growth, greater investments are needed in infrastructure (e.g. housing and roads) which further boosts economic activity in the region.

2. The growth of a regional economy

The Asian region has effectively built an economic environment that is more internally supportive than competitive:

• A cooperative economic environment – rather than countries competing to produce and sell goods, the region utilises the strengths of specific countries to complete different steps in the production chain. This process ultimately creates a more efficient system. Trade in the region has also more than doubled in the last 30 years and 51% of all Asian imports and exports are sourced from withinⁱ.
• Sustainable level of trade from within their own region – strength in regional trade means Asia is becoming less reliant on external economies for their own growth.
• Open trade in the region – this is largely due to a reduction in artificial economic barriers and increases in Free Trade Agreements over the last decadeⁱⁱ.

3. Rising domestic demand

Asia's ongoing contribution to world GDP is likely to be correlated to rising domestic demand and increases in consumer spending (in conjunction with Asia’s lower levels of personal debtⁱⁱⁱ).

• Increases in disposable income generate domestic demand – it is anticipated that by 2025 over 40% of the Asian population will fall into the category of ‘middle class’^iv. These individuals have at least one third of their income left for spending on non-essential items. This creates more opportunities for spending within the region.
• Government policy reforms to free up household income – China is a prime example of this trend. Their reforms include^v:
  • Increased monetary aid for university students
  • Free compulsory education for school aged children
  • Changes to pension schemes to encourage greater participation from both the public and private sector

Typically the top three reasons for individual savings in China are; healthcare (as a precautionary measure), provision for retirement, and social welfare (i.e. housing and education)^vi. Reforms like these will release a greater portion of household income for spending on discretionary items.

Why investPrint this page

• Access to a diversified portfolio of equities from Asia’s high growth markets with a major focus on China and India
• Potential for strong risk-adjusted returns (both capital growth and income) over the long term
• A hand-picked Asian equities team with regional expertise across a range of countries and market cycles, and experience in portfolio construction and management
• Ability to leverage our contacts and networks within Asia to gain a greater understanding of the investment landscape

AMP Capital’s Asian expertise

Our long-term presence and networks in the Asian region provide proprietary access to deal flow and enable us to gain insights into local markets to capture the best possible investment opportunities.

• 45 years of experience in the Asia Pacific region
• Regional offices in Beijing, Mumbai, Sydney, Singapore and Tokyo
• The first Australian company to receive a Qualified Foreign Institutional Investor licence to trade in China ‘A’ shares (those listed on the Shanghai or Shenzhen stock exchanges)
• We hold a Foreign Institutional Investor licence to invest on the Indian stock exchange

Hear from our experts

Karma Wilson, Head of Asian Equities, AMP Capital Investors, discusses Asia - the investment opportunity.

The AMP Capital Asian Equity Growth FundPrint this page

The Asian Equity Growth Fund ("the Fund") targets investment opportunities across Asia (ex-Japan) in the Greater China, Indian Sub-continent, East and South-East Asian regions. This includes markets such as Hong Kong, Korea, Singapore and Taiwan, while having significant exposure to markets in China and India.

Within these markets the Fund actively seeks stocks with the following characteristics; strong competitive advantage, effective management strategy and good access to capital.

In constructing the portfolio and managing the inherent risks, the team utilises their access to sophisticated technologies as well as their own experienced insights.

The offer at a glance

The teamPrint this page

We have shown commitment to building our Asian equity capability by dedicating resources to build a hand picked team over two years. Selecting individuals with specific regional expertise and backgrounds was a deliberate strategy to maximise the breadth and depth of knowledge leveraged within the team. All of our specialists working on this Fund have had experience in Asia during a wide range of markets and cycles and bring significant insights into portfolio construction and management.

They are centralised in our Sydney head office as this maximises knowledge sharing and idea generation, while enabling them to make efficient and informed decisions. Both senior and junior members travel to Asia regularly in order to visit on the ground specialists and conduct ongoing due diligence of our stocks.

Sanjay Ramadevan

BSc (Hons), MSc

Sanjay joined AMP Capital in January 2006 and the Asian equities team in October 2006. Sanjay has over 20 years business advisory and consulting experience, with core skills in analysis, design and implementation of investment management and financial services systems and practices. Prior to joining AMP Capital, he worked at Pricewaterhouse Coopers Consulting/IBM Business Consulting Services and National Mutual Funds Management.

Karma Wilson

BCom, MAppFin, FFin

Karma joined AMP Capital in September 2006 and is responsible for the ongoing development of our Pan-Asia investment capabilities and the management of the Asian Equities team. Karma has managed the AMP Capital China Growth Fund since its inception in 2006 and the AMP Capital Asian Equity Growth Fund since its inception in 2008. Prior to joining AMP Capital Karma worked for Five Oceans Asset Management, Goldman Sachs (located in Hong Kong, Singapore and New York), Bankers Trust, and Arthur Andersen where she started her career in 1989.

Ying Luo

BCom, MCom, CFA, CPA

Ying joined AMP Capital’s Asian Equities team in December 2006. Prior to joining the team, Ying worked for eighteen months in Beijing with our Asian Business Development Team researching business opportunities in China. Before starting with AMP Capital, Ying worked at AMP for three years on a graduate program and then in Group Treasury as a financial analyst.

Sally Chang

BS, MBA, MAppFin

Sally joined AMP Capital in August 2007 and is key in managing the Asian equities team’s relationship with China Life Asset Management’s equity team based in Beijing. Sally started her career in Asian equities in 1999 while living in her native Taiwan. Here she predominately covered the North Asian markets. Prior to joining AMP Capital, Sally worked for Credit Suisse First Boston, HSBC Asset Management and Primasia Securities.

Kevin Yeoh

BCom (Hons), BA, GradDipAppFin

Kevin joined AMP Capital in July 2007 and is currently based in our Beijing office. Prior to joining AMP Capital, Kevin worked for Macquarie Bank as a Senior Credit Analyst in the Risk Management Group. He also worked and studied in China, as both a Financial Analyst for Insurance Australia Group’s Chinese joint venture and as a journalist covering China for The Backbench.

Ragavan Sivanesarajah

BCom, CFA

Ragavan (Ragu) joined AMP Capital in August 2008. Prior to this, Ragu worked for Maple-Brown Abbott Investment Management as a founding member of their Asian equities team. He also worked at Bankers Trust as a Senior Trader and then Assistant Portfolio Manager on Asian and Japanese portfolios. Ragu joined the investment management industry in 1999 at the Commonwealth Bank on a graduate program.

Jonathan Reoch

BAcc, CA, MSc

Jonathan joined AMP Capital in October 2008. Jonathan’s investment industry experience dates back to 1993, both in asset management and equities research. He has extensive experience analysing financials and investing in the Asian Equity markets. Prior to joining AMP Capital, Jonathan worked with Maple-Brown Abbott Investment Management, ABN Amro, Credit Suisse First Boston, Martin Currie Investment Management and KPMG.

How to investPrint this page

For Personal Investors

Please download the Product Disclosure Statement (PDS) or order a copy of the PDS.

To find out more about the AMP Capital Asian Equity Growth Fund, contact your financial adviser or call our client services team on 1800 188 013

For Advisers

Please contact your AMP Capital business development manager or call our adviser services team on
1300 139 267 to obtain an application form.

To order copies of the Asian Equity Growth Fund PDS and Investor flyer, complete the order form. Alternatively, download the PDS now

To obtain further information on Why Asia, visit the Adviser resources section.

Contact usPrint this page

If you have further queries or require assistance please contact AMP Capital Investors as follows:

Personal Investors

Talk to your adviser or contact AMP Capital Investors:
Ph: 1800 188 013
Email: privateclients@ampcapital.com

Advisers/financial planners

Contact your AMP Capital BDM on:
Ph: 1300 139 267
Email: adviserinfo@ampcapital.com

Adviser resourcesPrint this page

AMP Capital’s house view is that Asian equities will outperform other asset classes in the medium to long term. While many investors believe they have strong exposure to Asian markets through their ‘international funds’, the reality can be quite different.

The MSCI misconception

International indexed funds, which are the vehicle for the majority of investment into Asia, do not provide representative exposure to key Asian growth markets:

• Exposure to Asia (China, India and developing Asia) is only approximately 7-8% in a fund benchmarked on the MSCI All Country (AC) World Index
• This is because the MSCI AC World Index weights stock allocation according to market capitalisation. There is a stronger bias to more developed regions such as North America, Europe and the United Kingdom where larger-cap companies are concentrated.
• In essence this means that MSCI AC World is allocating stocks on where growth has been, not necessarily where it will be.

We foresee future success from investing in markets of wider economic and GDP growth rather than allocating based on a traditional market capitalisation ‘benchmark’. The Asian region is a key example of where this type of growth will be concentrated. The Asian Equity Growth Fund, focuses exclusively on Asia (ex Japan) using the MSCI Asia (ex Japan) benchmark, enabling investors to access growth markets more directly.

Investing directly in Asia

Investing directly in Asia through companies domiciled in the region can provide greater exposure to potential growth and returns. Asian companies are best positioned to benefit from the growth story of Asia as they:

• have greater exposure to macro factors of local economies
• are able to leverage relationships with suppliers, governments and regulators due to a natural national bias providing them with greater access to business networks.
• have a home culture advantage; that is, a better understanding of target markets, the nature of trade within the region and how to capitalise on business opportunities.