Invesco Perpetual Asian Equity Income Fund
May 2017 (Content as at 30 April 2017)
The Invesco Perpetual Asian Equity Income Fund aims to generate a rising level of income together with long term capital growth by investing primarily in shares of companies in Asia and Australasia (excluding Japan). In pursuing this objective, the fund managers may include investments that they consider appropriate which include transferable securities, money market instruments, warrants, collective investment schemes, deposits and other permitted investments and transactions as detailed in Appendix 2 of the most recent Prospectus.
Asian equity markets generally had a positive month in April, with some stronger-than-expected economic data helping brush off concerns over geopolitical issues in Europe and North Korea, as well as fading confidence in President Trump’s ability to stimulate the US economy. However, returns for UK investors were slightly negative as sterling rebounded relative to most Asian currencies. In China, fears surrounding capital outflows and currency deprecation eased, although the positive impact of this was offset by increased concerns over a reduction in the availability of credit conditions. South Korea’s equity market edged towards an all-time high, buoyed by expectations of further improvements in corporate governance and positive earnings revisions, which helped offset concerns surrounding Chinese trade restrictions and mounting tensions with North Korea. The Philippines’ equity market was the largest gainer thanks to strengthened earnings expectations and positive sentiment around tax reforms. Meanwhile, Australia’s equity market lagged, in part due to increased concerns about housing affordability and a large sell-off in the iron ore price.
We seek to invest in companies whose share prices are substantially below our estimate of fair value and, in our view, have an ability to grow or maintain their dividend payments. In terms of sector exposure, the fund continues to have overweight positions relative to the benchmark index in real estate and telecoms, with holdings in these areas offering attractive yields and some (albeit relatively low) growth. Over the period we introduced a holding in VIVA Energy, a real estate investment trust which owns Shell branded petrol stations in Australia. We also remain focused on heavily cash-backed businesses with strong cash flow and potential dividend growth. As such, we introduced a holding in Mediatek, a leading Taiwanese semiconductor design company which has been out of favour due to increased competitive intensity, although we expect these pressures to subside over the medium-term. In turn, we sold Coal India.
|Launch date||07 March 2011|
|Sector||IA Asia Pacific Excluding Japan NR|
|Available in an ISA?||Yes|
|Team:||Invesco Perpetual - Asian Equities|
|Accounting period ends||
|Accumulation (No Trail)||B4JR4R4||GB00B4JR4R48|
|Income (No Trail)||B4KN501||GB00B4KN5012|
|Minimum lump sum||£500|
One-off charges taken before you invest
The entry charge for the fund is up to 5%. This is the maximum that might be taken out of your money before it is invested. For example, if you invest £1,000, an entry charge of 5% means £950 of your money will be used to buy shares in the fund.
The entry charge covers the costs of setting up your investment.
If you invest through a third party (such as a financial adviser), but do not receive financial advice on your investment, this charge may include payments to that third party. For more details see "What share classes are available for your ICVC funds?".
There is no exit charge for the fund.
Charges taken from the fund over a year
The ongoing charge figure is based on a fixed, all-inclusive fee and excludes portfolio transaction costs. The ongoing charge for each share class can be found in the relevant Key Investor Information Document available under 'Literature'. Investors will be provided with advance notice if any increases to this figure occur.
The ongoing charge covers all aspects of operating the fund during the year, including fees paid for investment management, administration and the independent oversight functions.
If you invest through a third party (such as a financial adviser), but do not receive financial advice on your investment, this charge may include payments to that third party. Once invested, your contract note or acknowledgement letter will show the amount of any payment in cash terms. For more details see "What share classes are available for your ICVC funds?".
Charges taken from the fund under specific conditions
No performance fee is charged.
Portfolio transaction costs1
On average, over the last three financial years, the fund incurred broker commissions of 0.08% and transfer taxes of 0.04%, as a necessary part of buying and selling the fund's underlying investments in order to achieve the investment objective. A proportion of these costs is recovered directly from investors joining and leaving the fund.
When the fund buys or sells shares, broker commissions and transfer taxes are paid by the fund on each transaction. In addition, there is a dealing spread between the buying and selling prices of the underlying investments. Unlike shares, other types of investments (such as bonds, money market instruments and derivatives) have no separately identifiable transaction costs; these costs form part of the dealing spread. Dealing spreads vary considerably depending on the transaction value and market sentiment. The estimated average dealing spread for the fund is 0.30% of the transaction value.
Comparing portfolio transaction costs for a range of funds may give a false impression of the relative costs of investing in them, for the following reasons:
- Transaction costs do not necessarily reduce returns. The net impact of dealing is the combination of the effectiveness of the manager's investment decisions in improving returns and the associate costs of investment
- Historic transaction costs are not an effective indicator of the future impact on performance
- Transaction costs for buying and selling investments due to other investors joining or leaving the fund may be recovered from those investors. For further information see Pricing policy note below
- Transaction costs vary from country to country
- Transaction costs vary depending on the types of investment in which a fund invests
- As the manager's investment decisions are not predictable, transaction costs are also not predictable
Pricing policy note1
We operate a single pricing methodology for this fund and reserve the right to adjust the fund's price to protect your investment from the costs of buying and selling investments that result from other investors joining or leaving the fund. The amount of any such adjustment is calculated by reference to the estimated costs of dealing in the underlying investments, including any dealing spreads, broker commissions and transfer taxes.
Typical adjustments to the fund's price are to increase it by 0.34% for net inflows or decrease it by 0.38% for net outflows.
We usually adjust the price to the maximum extent possible when the value of net contributions or withdrawals is significant, which helps to protect your investment from the costs of the resultant transactions.
1The fund's financial year end is 30 November 2016 Figures in these sections are as at 30 November 2016.
Product & fund information
The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested. Past performance is not a guide to future returns.
The fund invests in emerging and developing markets, where there is potential for a decrease in market liquidity, which may mean that it is not easy to buy or sell securities. There may also be difficulties in dealing and settlement, and custody problems could arise.
The fund may use derivatives (complex instruments) in an attempt to reduce the overall risk of its investments, reduce the costs of investing and/or generate additional capital or income, although this may not be achieved. The use of such complex instruments may result in greater fluctuations of the value of the fund. The Manager, however, will ensure that the use of derivatives within the fund does not materially alter the overall risk profile of the fund.
Yield and performance figures are based on the z (accumulation) share class. As this was launched on 12 November 2012, for the periods prior to this launch date, performance figures are based on the accumulation share class, without any adjustment for fees. Performance figures for all share classes can be found in the relevant Key Investor Information Document.
All fund portfolio figures are as at date shown (source: Invesco Perpetual).
Performance figures are shown in sterling, inclusive of reinvested income and net of the ongoing charge and portfolio transaction costs to date shown. The figures do not reflect the entry charge paid by individual investors. Sector average performance is calculated on an equivalent basis (source: Lipper).
The Historic Yield reflects distributions declared over the past twelve months as a percentage of the mid-market price of the fund, as at the date shown. It does not include any entry charge and investors may be subject to tax on their distributions. The fund’s ongoing charge is charged to capital. This has the effect of increasing the distributions for the year by the amount of the ongoing charge and constraining the fund’s capital performance to an equivalent extent.
Where Invesco Perpetual has expressed views and opinions, these may change. Where securities are mentioned they do not necessarily represent a specific portfolio holding and do not constitute a recommendation to purchase, hold or sell.
For the most up to date information on our funds, please refer to the relevant fund and share class-specific Key Investor Information Documents, the Supplementary Information Document, the Annual or Interim Short Reports and the Prospectus, which are available using the contact details shown.