Fidelity South East Asia fund
Liz Rae, investment adviser at The Share Centre, explains how investors can benefit from the potential of investing in Asia as a region and may wish to consider the Fidelity South East Asia fund.
"As a region, Asia has increased in importance since the turn of the century as the lure of potential higher returns is hard to ignore, however investor must note it is not for the fainthearted.
"We firmly believe that Asia will continue to prosper over the next 3-5 years and beyond, not only through their ability to continually deliver goods and services at lower prices than the West, but just as importantly through their continuing advancements of technology; whilst also developing trade relations with China.
"In everyday life consumers puts their faith in Asian brands, such as Hyundai, Samsung and LG, because they believe in the products and the quality of their goods, so why not invest in funds that offer exposure to them?
"However, there are a variety of issues investor should be aware of that make investing in this region of the world treacherous. Poor communication, poor regulation, lack of corporate governance and even corruption are just some of the difficulties faced within the region.
"The Fidelity South East Asia fund is an ideal way of investing within this region as its managers and analysts are involved with the participants of these markets on a daily basis. The fund manager, Allan Liu, has 23 years' investment experience and has focused on Asia Pacific equities his entire career.
"The fund invests in approximately 180 - 200 companies providing broad diversification. Liu prefers to invest in companies that demonstrate solid management, have a proven track record, global competitiveness and a growing market share. Consideration of the broader economic environment is another key element in Liu's decision making process.
"Due to the nature of the geographical region and the continuing development of their financial markets we rate this as a high risk investment for those investors who want broad Pacific region exposure in a well diversified portfolio.
"In terms of performance, the fund returned 53.3% over a 3 year cumulative period to 7 February 2011, and 129.7% over a 5 year cumulative period.
"The Fidelity South East Asia fund has an annual management charge of 1.50% and a standard initial charge of 3.50%.
"As the fund features in The Share Centre's Platinum 120 range, customers of the retail stockbroker wishing to invest in the Fidelity South East Asia fund will not have to pay the initial charge or purchase dealing commission. Customers can also invest in the fund from as little as £10."