Lombard Odier has added the Pacific rim fund to its LO Invest UK range of offshore funds.
Like the other funds in the range, this Luxemburg-based Sicav is a UK clone of a fund that is only available in Switzerland.
As an emerging markets fund, the Pacific rim fund aims to provide growth by investing in large and mid cap companies in Asia excluding Japan. The largest proportion of the fund – 33.1 per cent – is invested in Hong Kong and a substantial percentage goes into companies from Singapore, China and Taiwan. Regions such as Thailand and the Philippines are represented to a lesser degree.
Last year witnessed a great deal of political and economic turbulence in some of parts of Asia and this had a negative impact on the stockmarket. With new political leadership in places such as Thailand and the Phillipines, the prospects for 2001 may be brighter. However, the fund is likely to remain highly volatile and subject to currency risks because it is denominated in Euros.
The Pacific rim fund might be a scary prospect for many investors. But it could appeal to adventurous clients with a wide portfolio who want to take higher risks, coupled with the tax benefits of investing offshore.