Fidelity Southeast Asia manager Allan Liu is reducing some of the more sizeable bets made by his pr...
Fidelity Southeast Asia manager Allan Liu is reducing some of the more sizeable bets made by his predecessor KC Lee.
While Liu is also a conviction-led investor, he is keen to reduce the fund's beta through investing in a broader range of financially secure companies.
He is growing increasingly bullish on the outlook for the region, noting that companies have been deleveraging their balance sheets since the 1998 Asian crisis and are well positioned to benefit from any upturn in demand from the OECD economies.
'Over the past two years when the US economy has not been doing well, the quality Asian companies are continuing to take market share,' Liu said.
'If the OECD economies continue to improve then it is reasonable to assume these companies will grow faster.'
He said regional consumer spending has been weak during the downturn, but pent-up demand should bode well for consumer-facing stocks such as autos and retailers.
Country allocation is predominantly a by-product of stock selection, Liu stressed, but he will largely focus on the more liquid markets of South Korea, Hong Kong, Taiwan and to a lesser extent Singapore. After a strong bull run, valuations have dropped in Korea, he noted, due to receding concerns over the Iraq war and nuclear tensions over North Korea.
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