 Low interest rates and government stimulus will

continue to stimulate global economy

 Strongearnings growth driving greater equity

performance and low current bond yields

 Go bullish into equity

 Emerging markets and the Asian markets will be
the best regions to invest due to their strong
growth potential.

Data Source: International Monetary Fund

 Depreciation and lack of confidence in the US
currency resulted from the poor housing market,
mortgages loans and high unemployment in the
US will cause investors and central banks to store
their wealth in gold and precious metal

 Thisbullish demand will result in soaring prices for

gold and precious metal

 technologysector is expected to continue to

perform with increasing global demand for
technology products
 economic recovery might not be substantial
because it is mainly stimulated by government
expansionary fiscal policies

 real
underlying growth might still be weak or even
a possible double dip recession

 monitor how market will behave when interest rate

start to rise eventually

 government pulling out their stimulus and the cost

of deficit spending which may have negative
repercussion on the economy
 moderately aggressive investor

 wantshis investments to achieve long term capital

appreciation

 donot mind short term fluctuations in capital in

order to achieve potential higher returns
From market outlook and risk profile analysis,

 overweigh into equities as it is expected to

perform with greater returns over bonds

 allocate
more funds into Emerging markets and
Asian company equities

 these2 regions are forecasted to have the best

growth and performances in 2010 and beyond
 Goldand technology sectors were previously
discussed to do well in 2010

 therefore
funds that we have chosen are invested
in the emerging markets, Asian region, Gold and
Technology sectors which are expected to do best.

 appropriate asset mix for him is approximately:

80% in growth assets (for example, Equities)

20% in income assets (such as Bonds)
 EQUITY FUNDS PERCENTAGE (%)
Aberdeen Global Emerging Market Fund 25
United Gold and General Fund 15
Henderson Global Technology Funds 15
Aberdeen Asian Smaller Companies Fund 25
TOTAL 80

BOND FUNDS PERCENTAGE (%)

Legg Mason Asian Bond Trust 10
United GEMs Investments 10
TOTAL 20
Why emerging markets?
 Strong potential for long term
growth

 Growth exceeded that of

developed markets & will lead
global recovery
Source: Financial Express Analytics

 Itsequities surpass developed

markets last 5 years & will
continue
Main countries invested into:

Brazil
 Increasing consumer demand

 Increase confidences in its corporate sector

 Sizeable equity market
  Strong IPO equity

 Strong leadership by the President

 Hosting of world cup and Jeniro Olympics
China
 Expected growth of 8%

 Strong exports and manufacturing

  Industry output will increase by 19.2%

 Expected to be 2nd largest economy in 2010

  Less affected by economy meltdown

Top Holdings of Fund

China Mobile
  Subscribers exceeding 500million

  Good earnings growth

  Low debt to equity ratio
  23.1% return on equity

  24.4 % earnings per share

  Low P/E ratio 0.49

  Dividend yield of 13.8%

Samsung
  Biggest maker of semiconductors and flat-screen
in Asia
  Increased in profits

  Expected to sell 35million LCD

  Shipping to increased by 22%
 Mobile to rise by 31%

 Expected operating profit of 15.3 trillion won

 Invest 5.5 trillion won in development of facilities
Past Performance & Comparisons

Source: Fundsupermart
Source: My Fund Charts
Why Gold & Energy?
 Gold prices expect to hit $2000 in
2010
 Depreciation of US currency
 Global increase in demand
 Forecast of 73% gains even from
current high level
 Central banks are buying Gold
  Long term assurances
 Price of precious metal to increase
21%
Top Holdings of Fund

Gold Corp
 World’s Lowest cost gold producer

 Fastest growth rate in the industry

 110million exploration program
 Solid balance sheet

 No Debts and hedge positions

 Strong cash flow and dividend yield of 12 times a
year
Barrick

  Development of next generation mines

  Increase in its valuation price

  Invest more than US$3B in Dominican mine will

increase its production
  Gold production will rise to as much as 8 million
ounces from 7.4 million ounces in 2009.
  4th-quarter profit as it realized an average gold
price of $1,119, up 38%.
Past Performance & Comparisons

Source: Fundsupermart
Source: My Fund Charts
Top Holdings of Fund

Apple
 gain as global demand for smart phones
increases

Microsoft
  continued to profit with their introduction of
Windows7
Past Performance & Comparisons

Source: Fundsupermart
Source: My Fund Charts
Why Asia?

 strong
economic
growth in 2010 and
beyond

  Expected growth of
7%
Source: IMF WEO Database Oct 2009
Graph Extracted from MAS
Why Asia? (cont’d)

  Benefitting
from
low debts level

 Smaller
companies’
equities continue
outperforming that Source: COUTTS

of bigger
companies
Main Sectors Invested in

Financial Sector
With recovery,
  funding spreads trading close to pre-crisis level

 corporate borrowing spreads narrowed

 MSCI world stock index is also up 70 percent from

its March low in 2009
Past Performance & Comparisons

Source: Fundsupermart
Source: My Fund Charts
Main countries invested into
South Korea
 Increased consumer spending
 1st country in Asia to sign FTA with EU in 2010
and the US in near future will boost trade
  Increased confidences causing Korean Won to
strengthen
  Set up foreign educational institutions
  Attract foreign medical centres and schools

  Enhance competitiveness in nuclear power

Indonesia
  One of the largest growth expectations in Asia

 keep inflation low at current & prevent capital

withdrawal
  Banks lending funds to help factories financially
  Increase trading activities and capital inflow
  Appreciation of Indonesian Rupiah

  Increase in stock market index

Top Holdings of Fund
Export-Import Bank of Korea (EXIM Bank of Korea)
  Reliant upon trading activities
 Growth stimulated by the increased trading
activities and several FTAs
 Invest into newly set-up Korean’s Carbon Fund
  Financial aid to support export of nuclear power
tech
Indonesia Government Bond
 high yields with Indonesian Rupiah appreciation
  Government fight corruption to increase
confidence
Past Performance & Comparisons

Source: Fundsupermart
Source: My Fund Charts
Why Latin America?

  Relied on domestic demand for region’s growth

  Early government stimulus in crisis to avoid being

hit too badly by crisis

  Bilateral trade with China

Countries invested into
Brazil
Mexico
  Rising oil prices increases
revenue
  Hedge oil prices to protect oil
revenue gains
  Growth in significant industries
  National Infrastructure Fund its
double projects in 2010 Source: Moody’s Economy.com

  Host mini Olympic games in

2010
Top Holdings of Fund
Controladora Mabe
  Largest household appliances manufacturer in
America
  Currently 5 plants in South America
  Invests MXP$220m to build plants in Brazil and
Mexico
Banco Do Brasil
  Expected with a 40% growth
  More growth potential since it underperformed in
2009
  Sell stock to fund lending growth and expansion plans
  Goldman Sachs encouraged and recommended this
company
Past Performance & Comparisons

Source: Fundsupermart
Source: My Fund Charts
Required Rate of return = Rf + b(Ri – Rf)

Taking R(f) = 3.6%

FUNDS BETA REQUIRED RATE

OF RETURNS (%)
Aberdeen Global Emerging Market 0.85 24.22
Fund
United Gold and General Fund 0.86 24.95
Henderson Global Technology Funds 0.96 21.81
Aberdeen Asian Smaller Companies 0.58 18.58
Fund
Legg Mason Asian Bond Trust 1.21 17.74
United GEMs Investments Portfolio required
0.4 rate of return = 20%
7.82
 FUNDS E(R) E(R) PER YEAR
OVER 7 (%)
YEARS(%)
Aberdeen Global Emerging Market 195 27.86
Fund
United Gold and General Fund 199 28.43
Henderson Global Technology Funds 158 22.57
Aberdeen Asian Smaller Companies 206 29.43
Fund
Legg Mason Asian Bond Trust 107 15.29
United GEMs Investments 99 14.14
YEAR PORTFOLIO NAV at beginning of year ($)
2010 10,000,000
2011 14,980,000
2012 14,320,880
2013 19,562,322
2014 23,337,850
2015 23,034,458
2016 32,340,379
2017 41,654,409
Total returns over 7 yrs = 417%

Average returns per year (compounded)= 23%

Short-Term Effects
 Trading activities decreases

 Stock market (esp. NYSE) drop

 Business profits reduced

Long Term Effects
 Further inflation due to government stimulus

(eg. Reconstruction of affected areas)

 Causes USD to weaken even more investors’
confidence in USD dropping
 Trade decreases now as exports become
relatively more expensive
 Unemployment
 Larger deficit financing

 Higher oil prices

 Higherfuture earnings from increasing oil prices
due to oil companies in top holdings

 Not
heavily invested in exports, will not be
adversely affected by decrease in trade activities

 Topholdings in NYSE, may see drop in value, but

only in SHORT TERM
 USD depreciation, lack of confidence, high
unemployment

 Long term assurance, safer than currency

 Euro and USD seems volatile and weak

 Inflation will rise with continuous stimulus and low

interest rates will continue to erode value of currency

 Hold wealth in gold

 Business activities affected

 75% of funds invested in the U.S.

 Reduced company’s profits

 Slightly hit by the temporary halt in U.S. trading

 Effects only in the Short Run

 Latin America relies heavily on trading with U.S

 GDP might not grow as expected

 EQUITY FUNDS PERCENTAGE (%)
Aberdeen Global Emerging Market Fund 25
United Gold and General Fund 15
Henderson Global Technology Funds 2
Aberdeen Asian Smaller Companies Fund 15
TOTAL 57

BOND FUNDS PERCENTAGE (%)

Legg Mason Asian Bond Trust 10
United GEMs Investments 3
TOTAL 13

EQUITY PERCENTAGE (%)

Straits Times Index (STI ETF) 5
Standard & Poor’s 500 5
Tower Group, Inc 10
Chubb Corporation 10
TOTAL 25
STI ETF & S&P 500:
 Expect index to fall rapidly after news broke out

 Take advantage of gains as index recovers

Property insurance companies

 Expect the share prices to fall in such a situations
when paying out claims in huge losses in property
 Tower Group, Inc
 Chubb Corporation
Tower Group, Inc
 ROE : 15.78%
 P/E ratio : 8.08%.
 Larger dealing in property insurances coverage

Chubb Corporation
 ROE :17.90%
 Healthy financial ratios
 P/E ratio is 8.28 (higher than competitors)
 Healthy cashflow
 No debt incur in the company
 Major insurance coverage held in New York, likely to
be hit on such an impact and will result in a fall of it
share price
 CHAN YOKE WEI
FOO LU-SHAN WINNIE
GOH XIANG XIAN