Proceed with caution
The recent proliferation of country specific funds available to Australian retail investors come with additional risks and should only be used as part of a broadly diversified portfolio, according to a new Zenith Investment Partners report.
The 2007 International Shares Sector Review found that, if used wisely, these funds have the potential to enhance portfolio returns by capitalising on the above average economic growth in countries such as China and India.
However, Zenith senior investment analyst Glen Franklin cautioned it was critical that investors understood the risks inherent in such investments.
“When you invest in a single economy you haven’t got that diversity … and you’re also investing in a much more volatile economy,” he said.
The international shares review resulted in the boutique investment researcher placing 29 products on its recommended list from an initial universe of 150 funds.
These funds have been categorised under the following four sub-headings.
Global (hedged) funds
GVI Global Industrial Share Fund — Recommended
Schroder Global Active Value Fund — Recommended (new addition)
Global (unhedged) funds
BT Wholesale International Share Fund — Highly Recommended
Acadian Wholesale Global Equity — Recommended
Morgan Stanley Global Franchise Fund — Highly Recommended
Perpetual Wholesale International Fund — Recommended
Platinum Unhedged Fund — Recommended (new addition)
Walter Scott Global Equity Fund — Recommended
Zurich Investments International Share Fund — Recommended
Regional funds
Aberdeen Asian Opportunities Fund — Recommended
AFM Davis Value Trust — Highly Recommended
Fidelity India Fund — Recommended
K2 Asian Absolute Return Fund — Recommended
MQ Asia Long Short Fund — Recommended
Platinum Asia Fund — Recommended
Platinum European Fund — Recommended
Platinum Japan Fund — Recommended
Premium China Fund — Highly Recommended
Schroder Global Emerging Markets Fund — Recommended
Specialist funds
Acadian Wholesale Global Equity Long Short — Recommended (new addition)
Acadian Wholesale Geared Global Equity — Recommended (new addition)
ColonialFirstState Global Resources Long Short Fund — Recommended
Colonial First State Global Resources Fund — Highly Recommended
HFA International Shares Fund HW — Recommended
Macquarie Global Private Equity Securities Fund — Recommended
Platinum International Brands Fund — Recommended
Platinum International Fund — Highly Recommended
PM Capital Absolute Performance Fund — Highly Recommended
Select Gold Fund — Recommended
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