The case for UOB United International Fund
An acquaintence of mine wrote to me his justification why he thinks it is more worthwhile to invest in UOB United International Fund compare to the basic index approach.
“Attached is an analysis of the global equity funds we have in Singapore based on S&P-Funds’ website. It shows that the Infinity Global Stock Fund isn’t really a good fund for Singaporean investors (Amazing isn’t it?)
There are a lot more funds that are better than it (consistently) and some of them, the difference is a lot. Another amazing conclusion is that the top 5 funds are all by local fund houses. Of course the reason is that they deviate quite a lot from MSCI world asset mix.
From the analysis, I would buy the UOB United International Growth fund.
Reasons:
1) Good performance – Very much better than the index over 5 yrs (individual year and cumulative)
2) Consistent performer
- Except for this yr, it has always been in the top 10 funds
- Even this yr it is ranked 13th out of 49 funds and is still better than the Infinity Global stock and universe’s average.
3) Large fund size – low chance of closing and low expense.
UOB Optimix Sure Fd (20.50m)
UOB United International Growth (237.49m)
UOB Optimix Contrarian (2.67m)
DBS Shenton Global Opportunities (23.13m)
DBS Mendaki Global (3.36m)
4) Lower than average expense ratio (but it seems to be getting larger!) – But since it can deliver good performance it is not so critical.
Anyway it is up to you all to decide on which funds you want to invest it.
Please let me know if you need any clarifications. Also, this is a framework on how to select a fund to buy.”
I agree that the frame work are things that we should look at when we consider fund purchases. A more relevant question is why UOB Optimix Sure fd is not his choice. Given that its performance are astounding compare to its peers (from the sheet), we should seriously consider this. A reason why it is not his choice could be the size of the fund as well as it expense ratio.
do note that some of these funds may be operated based on the expertise of a “star manager”. With indexing you have less problems that should the star guy leaves, ur fund performance will be adversely affected.
I do noticed the increase in expense ratio for UOB united international fund as well. While it is stilll considered low, i cannot understand why when the fund size increases, its expense ratio goes up! Its suppose to be the other way round. does that mean that there is a hell increase in stock turnovers?
Related posts:
- Macquarie International Infrastructure Fund (MIIF) quarter review
- UOB Gold and General – An underperforming fund
- Macquarie International Infrastructure Fund (MIIF)’s a high yield attractive play currently
- Macquarie International Infrastructure Fund (MIIF) Q3 2011 and 9 month results: 8% yield locked in
- Fund Articles From Wilfred
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