KUALA LUMPUR: Fund managers gathered at Invest Malaysia 2017 today see growth opportunities among laggard stocks in Asean markets in the second half of this year.
"The valuations in North Asian markets are very high already. I would think in the second half of this year, the focus would shift to infrastructure and construction-related stocks in Asean markets," said Invesco Singapore chief executive officer Abdul Jalil Rasheed.
He said while investors are driven to put money into stocks that offer growth through increased automation or use disruptive game-changing technologies, there is no one-size-fits-all method of gauging fund managers' stock pickings in any given market within Asean.
Jalil was speaking at the first plenary session titled Finding Hidden Gems, moderated by Astro Awani's Smart Money and Money Talk host, Ibrahim Sani.
This year’s Invest Malaysia series marks its 13th edition. Over 1,500 delegates, of which more than 900 are fund managers with total assets under management of US$19.9 trillion, have gathered at the event.
Earlier, Prime Minister Datuk Seri Najib Razak encouraged policy-making which embraces a digital economy, and urged businesses to leverage on the Internet-of-Things (IoT) in order to be more productive.
Singapore-based fund manager Jalil praised Malaysia for encouraging e-commerce and initiating its first Digital Free Trade Zone (DFTZ). He shared his observation of Singapore's logistics infrastructure and commented that for e-commerce initiatives to take off in a big way, policy-making should focus at ensuring smooth flowing traffic along main routes into and out of key seaports.
"E-commerce and logistics go hand-in-hand. In order for e-commerce to flourish and reap the benefits of a digital economy, policy-makers need to invest in easing peak congestions along main trucking routes and Customs checkpoints at seaports and airports," Jalil said.
"As fund managers, we would see growth potential in the logistics sector as and when the government allocates funds to solve congestion problems and unreliable service delivery at Malaysia's main gateways," he added.
Other members of the panel are Natixis Asset Management chief investment officer Chong Yoon Chou, and CIMB Principal Asset Management chief investment officer Patrick Chang.
Chang equated the search for hidden gems to the famed quote "Mama always said life was like a box of chocolates. You never know what you're gonna get!" by the lead character Forrest Gump in the eponymous 1994 movie.
Basically, there is a variety of flavours available and since they are covered in chocolate, you won't know what you are getting until you bite into it.
In short, Chang cautioned that fund managers are not really able to tell what stocks and companies are about, until they put in their money. Fund managers would still have to make those brave decisions.
Chong, another fund manager who is based in Singapore, noted that the investment climate in Malaysia is getting brighter.
"Back in December 2016, the ringgit was weak at RM4.50 against the US dollar and now, it has strengthened to RM4.30. As a consequence, Malaysia's bond market has improved considerably," he said.
Chong went on to say that his team, apart from companies listed on stock exchanges, also looks into investing into privately-held companies that may be risky but have the potential for higher returns.
He also highlighted that his team is using sophisticated technologies to stay ahead of the curve, since the average retail investors is connected to real time information via their smartphones.