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Published on October 23, 2007

Pornsant Hathirat said the previously named Income Gold Fund had 97.3 per cent of its money in bonds.

The new fund will see management fees slashed to 20 basis points from the usual 65.

Pornsant estimated lower management fees would result in quarterly yields of 3.8 per cent.

"The fund will be an alternative for investors, primarily to rest their money before they decide on their next investment move," Pornsant said.

Asset managers have been competing fiercely for business. They started three- and six-month funds to attract customers. Because fees spiralled at the managers' expense, now only large companies with close relationships with banks can afford to offer them.

Pornsant said the company's Emerging Opportunities Bond Fund had produced a net return of 1.94 per cent in its first three months.

Its feeder fund - the Luxembourg-based Aberdeen Global Emerging Markets Bond Fund, which invests heavily in Latin America - benefited from the recent 50-basis-point interest-rate cut by the Federal Reserve, allowing markets to recoup distressed assets, Pornsant said.

Buoyant commodities prices, fuelled by growing demand in China and India, underline the economic strength of emerging markets, Pornsant added.

The feeder fund has 7.9 per cent of its US$537.8 million (Bt18.38 billion) capital in Turkey. In spite of recent unrest involving Kurdish rebels, Pornsant brushed off geopolitical risks.

"It has created sentiment, really," she said, arguing that the fund could swap into United States treasury notes if geopolitics got out of hand.

 Ki Nan Tsui

 The Nation