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Ashburton finds ‘Chindian’ opportunities

Ashburton has brought out the Chindia equity fund, an Oeic that aims for growth by investing in China and India.

The fund is available in sterling or dollars and is managed by the company’s Asia Pacific specialist Jonathan Schiessl. Schiessl has managed Ashburton’s Jersey-based Asia Pacific fund for over six years.

The majority of the new fund will be invested in Chinese and Indian companies, but the portfolio will also contain multi-national companies in other countries that benefit from growth in China and India.

The fund will be benchmarked 50 per cent to MSCI China and 50 per cent MSCI India. In keeping with the Ashburton approach to equities, Schiessl will not be constrained by the benchmark. The fund will take a bottom-up approach to stock selection, enabling the manager to pick the companies and sectors it believes can deliver the best growth at a reasonable price.

The manager believes that domestic consumption will be a primary factor driving future growth, as reliance on exports is decreasing in China and India. With growth in these regions accelerating beyond the growth rates of the US and Europe,

The company believes there are long-term rewards to be had, although it expects volatility along the way. it also believes its unconstrained, actively managed approach is ideally suited While India performed well overall last year, China has a better developed infrastructure which may affect its short term outlook.

Strong growth in China has led to an expanding middle class, so even if demand falls due to a U slowdown, this should be offset by domestic demand. But investors should still be prepared for short-term corrections within the longer-term trend for growth.

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