Country focus: Singapore
A feature of Alpha POWER Shares – Asian Lions, is that it invests in countries benefitting from strong Chinese economic growth.
Countries are chosen by their economic growth prospects. For example, the portfolio is currently not investing in Japan, which has a modest growth outlook.
At inception, the stock portfolio will be drawn from the high-growth economies of Korea, Taiwan, Hong Kong, Malaysia and Singapore.
Singapore is especially interesting after recently heavy falls saw the MSCI Singapore index down 11.4 per cent in the first quarter of 2008.
Although Singapore has a diversified manufacturing and export base it will not be immune from an almost certain recession in the United States.
And it is likely that Singapore, which had strong asset inflation and a peaking business cycle late last year, may face further downside risk to its economy this year.
The question, of course, is how much of this risk is already priced into Singapore equities.
The Singapore stockmarket is now trading on an average prospective price earnings multiple of 13 times - a reasonable valuation for a market that is a big winner from growth in China, and is a stable, mature economy.
Financial stocks, telecoms and companies exposed to the strong construction cycle in Singapore look the best bets, reports Lion Capital, the award-winning Singapore fund manager that is actively managing the Alpha POWER Shares – Asian Lions, portfolio.
“On a valuation perspective, the Singapore market is looking attractive,” says Lion.
The Alpha POWER Shares – Asian Lions, portfolio holds five Singapore stocks its portfolio of 20 stocks.
They include the quality blue chips:
- HongKong Land Holdings
- Singapore Technologies
- DBS Group
- United Overseas Bank
- Singapore Telecoms
To read more about these stocks, click here
