Henderson Far East Income was established in 1989 and was the first investment trust to specialise in Asian Income. The fund aims to provide a high level of dividend as well as capital appreciation from a diversified portfolio of investments traded on the Pacific, Australasian, Japanese and Indian stock markets.
The company was re-domiciled to Jersey in 2006 to provide improved investment flexibility and an enhanced yield.
Mike Kerley was appointed investment manger in February 2007 but his involvement in the portfolio dates back to 2005. He is a specialist in Asian investment.
The fund invests through a value-driven process focusing on management quality, sustainability of business model, earnings and cash flow. The manager will use gearing on a selective basis with the aim of enhancing returns for investors.
Mr Kerley believes that many Asian companies are adopting a Western attitude to rewarding shareholders by paying higher dividends. He favours the long-term growth story of China, saying stocks in this country typically carry a lower yield relative to the region but have solid fundamentals and a strong chance of growing dividends over time.
The portfolio has a high exposure to Asian financials, especially bank stocks such as DBS (Development Bank of Singapore) and Bank of China and also to telecoms which display utility-like characteristics. Mr Kerley believes most Asian banks are the polar opposite to banks in the west, carrying excess liquidity and unlikely to suffer the higher provisioning of their developed peers yet have been sold down to levels which do not coincide with their superior fundamentals.
| HENDERSON FAR EAST INCOME (HFEL) | |||
| PRICE:* | 247p | NAV:* | 240.24p |
| SIZE OF FUND:* | £199m | PRICE DISCOUNT TO NAV:* | 4.06% |
| No OF HOLDINGS: | 45 | 1 YEAR PRICE PERFORMANCE* (-9/09%): | NAV PERFORMANCE (-16.4%)* |
| SET UP DATE: | 1989 (redomiciled to Jersey in December 2006) | 3 YEAR PRICE PERFORMANCE* (9.17%): | NAV PERFORMANCE (3.83%)* |
| MANAGER START DATE: | Feb 07 | 5 YEAR PRICE PERFORMANCE * (42.05%): | NAV PERFORMANCE (45%)* |
| TURNOVER: | 12.2m** | TOTAL EXPENSE RATIO: | 1.19% |
| VOLATILITY: | YIELD*: | 4.80% | |
| TRACKING ERROR: | GEARING: | 0% | |
| SHARPE RATIO: | MORE DETAILS: | www.itshenderson.com | |
Source: Henderson and *Datastream
Notes: **Revenue only
TOP TEN HOLDINGS
| Holding | % |
| Bank of China | 4.4 |
| China Mobile | 4 |
| DBS | 3.8 |
| Sino Land | 3.5 |
| High Tech Computer | 3.3 |
| Zhejang Expressway | 3 |
| Philippine Long Distance Telephone | 2.9 |
| Woolworths | 2.8 |
| Keppel | 2.8 |
| Henderson Land Development | 2.7 |
GEOGRAPHIC BREAKDOWN
| Country | % |
| China | 19.9 |
| Hong Kong | 18.4 |
| Singapore | 14.2 |
| Australia | 14.1 |
| Taiwan | 9.9 |
| Thailand | 6.8 |
| South Korea | 6.1 |
| Malaysia | 4.6 |
| The Philippines | 2.8 |
| Cash & Fixed Interest | 3.2 |
