Foreign investment funds are ready to expand.

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February 20, 2024

Asset management company Krungsri Asset Management (KSAM) predicts foreign investment funds (FIFs) will continue to grow in 2024 as Thailand's gross domestic product (GDP) expands less than other economies in the region and the volatile local bourse lacks a clear growth outlook. KSAM recommends investors choose Asian stocks with a global presence, with a focus on the Indian and Vietnamese markets.

"The global economy is still volatile due to several factors, making investments risky this year," said Chief Executive Supaporn Linabanchong. "We are focused on investing in global top-tier companies that are stable and able to grow in a fluctuating market, including leading luxury brands that continue to grow in a slowing global economy."

As other Asian economies have higher growth rates than Thailand, especially India and Vietnam, KSAM will focus its investments in these markets. However, China is temporarily not suitable for investment due to the ongoing crisis in the real estate sector.

KSAM wants asset under management (AUM) to grow 2.1% this year to 580 billion baht. The growth is in line with industry peers. In the week ending February 9, the company had net inflows into investment funds worth about 20.9 billion baht, which was the fifth highest result in the industry in terms of managed assets, Ms. Supaporn said.

KSAM expects the main inflows to come from money market funds as investment returns are around 2%, which is still above deposit interest rates.

This year, the company is also emphasizing the development of online investment tools to improve service efficiency and make it easier for customers to relate to investment and pension funds, as well as increasing the number of sales agents. New products will be launched, including the new Thai ESG fund and FIF funds, which are becoming increasingly popular and suitable for current market conditions.

KSAM has put forward five themes for investors to choose from this year, including bond funds that will benefit from lower US interest rates. The second theme is Emerging Markets funds, which are expected to attract inflows following a weaker US dollar. The third is the global mark-to-market fund, which invests in high quality stocks with low debt, high returns and good cash flows. The fourth theme is investing in stocks with strong positive factors, such as technology stocks, which are likely to outperform the market due to artificial intelligence and the recovery in the semiconductor market. The last group is the Thailand equity fund, which focuses on stocks with turnaround potential.

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