Attached files
| file | filename |
|---|---|
| 8-K - TAIWAN FUND INC | v210789_8k.htm |
|
THE TAIWAN FUND, INC. (THE
‘FUND’)
MONTHLY
INSIGHT
|
 |
|
AT JANUARY 31,
2011
|
|
IN BRIEF
|
||||||||
|
Net asset value per
share
|
US$21.19 | |||||||
|
Market
price
|
US$19.57 | |||||||
|
Premium/(discount)
|
(7.65 | %) | ||||||
|
Fund size
|
US$393.6m | |||||||
|
Source: State Street Fund Bank and
Trust Company.
|
||||||||
|
At January 31,
2011
|
US$ return
|
|||||||
|
Fund*
|
TAIEX Index†
|
|||||||
|
%
|
%
|
|||||||
|
One month
|
1.7 | 2.4 | ||||||
|
Three
months
|
14.3 | 14.7 | ||||||
|
One year
|
37.4 | 31.7 | ||||||
|
Three years %
pa
|
9.2 | 10.4 | ||||||
|
Past performance is not a guide to
future returns.
|
||||||||
|
Returns are annualized, except for
periods of less
|
||||||||
|
than one
year.
|
||||||||
|
*Source: State Street Bank and
Trust Company.
|
||||||||
|
NAV
performance.
|
||||||||
|
†Source for index data:
TWSE.
|
||||||||
SHANGHAI TEAM
The Martin Currie Shanghai Team
MANAGER’S COMMENTARY
The TAIEX Index was up 2.4% in January,
led by the financial sector. There are signs, however, that this might be the
Year of the Hare, rather than Year of the Rabbit, for Taiwan. We see two factors that should boost
the Taiwan economy.
The first is that enterprise investment
and domestic consumption are picking up. Some manufacturers are now increasing
their production base in Taiwan, instead of China, given the greater convenience and
declining mainland labor-cost and tax advantages. This is improving demand for
land, labor, capital equipment and local financial services. The number of
tourists visiting Taiwan reached 5.5 million in 2010, thanks
mainly to Chinese tourists (up to 1.6 million from 972,000 in 2009). Most
excitingly (from the point of view of asset markets, anyway), there are signs
that mainland capital is heading for Taiwan. In January, a Shenzhen-based property
developer, Fantasia, reported that the Taiwan Stock Exchange has approved its
issue of a Taiwan Depositary Receipt (TDR), the proceeds of which would be used
to invest in a property-evelopment project in Kinmen. This is the first official
approval we have heard of for Chinese investment in Taiwanese property. The
market is already open to Chinese portfolio investment.
The other driver is the recovery in
exports, not just to emerging markets like the Middle East and Africa, but also to developed markets. We have
noticed a new vigor in the attitude of Taiwanese companies to exploiting the
domestic Chinese market. We expect that many will be able to win market share
through good quality and service. These trends are reflected in the recovery of
cargo throughput at Taiwan’s largest port, Kaohsiung, up 22% year on year in 2010 after a
long decline.
Thanks to these two forces, the
unemployment rate is falling (4.67% for December), salaries are rising once
more, consumption is booming (retail numbers for December hit a record high and
new-car sales in January grew by 105% year on year), consumer confidence is
climbing (86.7 in January, a 10-year high), foreign-exchange reserves are
expanding (to US$ 387 billion in January, another record high), and the NT
dollar is appreciating.
MONTHLY INSIGHT
INVESTMENT STRATEGY
The Fund is 95.7% invested with holdings
in 60 companies.
We bought the TDR of Good Friend
International Holdings, a
leading Taiwanese machine-tool-maker focused on China, which was trading at a discount to its
listing in Hong
Kong. The firm’s robust
order book and exposure to China make the valuation attractive. We also
added Powercom, an uninterruptible power supply maker,
to the portfolio, because of strong earnings growth from shipments of solar
inverters. Another purchase was King’s Town
Construction, which is best
placed to benefit from a recovery in the depressed Kaohsiung property market. And we added world’s
leading industrial PC producer, Advantech, which now looks cheap relative to its
steady growth prospects.
We took some profits by reducing our
holding in Taiwan Surface
Mounting Technology. The
outlook remains good, but we wanted to redeploy funds in the stocks above, which
we believe offer more upside. We also reduced our holding in WPG
Holdings, where the
earnings growth seems likely to slow. We started to sell Syncmold
Enterprise, which will
suffer from the cannibalization of the desktop-PC market by tablet
PCs.
On January 6, 2011 we distributed US$1.5
million in dividends from net investment income to
investors.
Chris Ruffle, Martin Currie
Inc*
*Martin Currie Ltd and Heartland Capital
Management Ltd (HCML) have established MC China Ltd (MCCL), as a joint venture
company, to provide investment management or investment advisory services to the
range of China investment products managed by Martin
Currie.
MCCL has appointed Martin Currie
Investment Management Ltd (MCIM), or its affiliates, as investment manager of
Martin Currie’s China investment products. HCML has seconded
both Chris Ruffle and Shifeng Ke to MCIM, or its affiliates, on a full time
basis with the same roles and responsibilities as if they were full time
employees.
Martin Currie Inc took over management
of the Fund on May 8, 2010.
|
FUND
DETAILS
|
||||
|
January 31,
2011
|
||||
|
Market cap
|
US$363.5m | |||
|
Shares
outstanding
|
18,575,214 | |||
|
Exchange
listed
|
NYSE
|
|||
|
Listing
date
|
1986
|
|||
|
Investment
manager
|
Martin Currie
Inc
|
|||
|
Source: State Street Bank and
Trust Company.
|
||||
|
PERFORMANCE
|
(US$
RETURNS)
|
|||||||
|
(US$
returns)
|
NAV %
|
Market price
%
|
||||||
|
One month
|
1.7 | 1.7 | ||||||
|
Three
months
|
14.3 | 14.8 | ||||||
|
Three years %
pa
|
9.2 | 9.8 | ||||||
|
Past performance is not a guide to
future returns. Returns are annualized, except for periods of less than one
year.
|
||||||||
|
Source: State Street Bank and
Trust Company.
|
||||||||
|
SECTOR
ALLOCATION
|
||||||||
|
Fund %*
|
Benchmark %†
|
|||||||
|
Electronics
|
26.2 | 50.7 | ||||||
|
Finance
|
16.7 | 14.0 | ||||||
|
Wholesale and
retail
|
13.2 | 5.3 | ||||||
|
Construction
|
6.6 | 2.0 | ||||||
|
Plastics
|
5.7 | 8.9 | ||||||
|
Textiles
|
4.0 | 2.1 | ||||||
|
Foods
|
3.8 | 1.4 | ||||||
|
Electric and
machinery
|
3.0 | 1.0 | ||||||
|
Steel and
iron
|
3.0 | 2.9 | ||||||
|
Chemicals
|
2.9 | 2.0 | ||||||
|
Others
|
2.7 | 1.8 | ||||||
|
Healthcare
|
2.3 | — | ||||||
|
Rubber
|
2.0 | 1.2 | ||||||
|
Glass and
ceramics
|
1.5 | 0.4 | ||||||
|
Transportation
|
1.4 | 2.7 | ||||||
|
Cement
|
0.7 | 1.1 | ||||||
|
Automobile
|
— | 1.0 | ||||||
|
Electrical appliance &
cable
|
— | 0.6 | ||||||
|
Tourism
|
— | 0.5 | ||||||
|
Paper and
pulp
|
— | 0.4 | ||||||
|
Other assets and
liabilities
|
4.3 | — | ||||||
|
*Source: State Street Bank and
Trust Company.
|
||||||||
|
†Source for index data:
TWSE.
|
||||||||
|
15 LARGEST
HOLDINGS
|
|||||
|
44.3% of
holdings
|
Sector
|
% of net
|
|||
|
assets
|
|||||
|
Far Eastern Department
Stores
|
Wholesale and
retail
|
4.0 | |||
|
Wah Lee
Industrial
|
Electronics
|
3.6 | |||
|
Chinatrust Financial
Holding
|
Finance
|
3.5 | |||
|
China Petrochemical
Development
|
Plastics
|
3.4 | |||
|
SinoPac Financial
Holdings
|
Finance
|
3.3 | |||
|
President Chain
Store
|
Wholesale and
retail
|
3.1 | |||
|
KGI
Securities
|
Finance
|
3.1 | |||
|
Tung Ho Steel Enterprise
|
Steel and
iron
|
3.0 | |||
|
Synnex Technology
International
|
Electronics
|
2.8 | |||
|
Yuanta Financial
Holding
|
Finance
|
2.7 | |||
|
Fubon Financial
Holding
|
Finance
|
2.6 | |||
|
Wistron
NeWeb
|
Electronics
|
2.5 | |||
|
Uni-President
Enterprises
|
Foods
|
2.3 | |||
|
Nan Ya
Plastics
|
Plastics
|
2.3 | |||
|
WT
Microelectronics
|
Electronics
|
2.1 | |||
|
*Source: State Street Bank and
Trust Company.
|
|||||
|
PERFORMANCE
|
(US$ returns at January 31,
2011)
|
|||||||||||||||||||||||||||||||
|
One month
|
Three
months
|
Calendar
year
|
One year
|
Three years
|
Five years
|
Ten years
|
Since
launch
|
|||||||||||||||||||||||||
|
%
|
%
|
to date
|
%
|
% pa
|
% pa
|
% pa
|
% pa
|
|||||||||||||||||||||||||
|
%
|
||||||||||||||||||||||||||||||||
|
The Taiwan Fund,
Inc
|
1.7 | 14.3 | 1.7 | 37.4 | 9.2 | 8.4 | 5.3 | 10.0 | ||||||||||||||||||||||||
|
TAIEX Index
|
2.4 | 16.4 | 2.4 | 31.7 | 10.4 | 9.1 | 5.6 | 10.0 | ||||||||||||||||||||||||
|
TAIEX Total Return
Index
|
2.4 | 16.4 | 2.4 | 36.5 | 14.8 | 13.3 |
na
|
na
|
||||||||||||||||||||||||
|
MSCI Taiwan Index
|
3.2 | 17.9 | 3.2 | 35.4 | 11.4 | 9.6 | 5.9 |
na
|
||||||||||||||||||||||||
Past performance is not a guide to
future returns. Source: State Street Bank and Trust Company. Launch date
December 23, 1986. Returns for the Fund are historical total returns that
reflect changes in net asset value per share during each period and assume that
dividends and capital gains, if any, were reinvested. Returns are annualized,
except for periods of less than one year.
Source for index data: MSCI for the MSCI
Taiwan Index and TWSE for the TAIEX Total Return Index and the TAIEX Index. For
a full description of each index please see the index descriptions
section.
Returns for the TAIEX Index are not
total returns and reflect only changes in the share price but do not assume that
cash dividends, if any, were reinvested, and thus are not strictly comparable to
the Fund returns.
The TAIEX Total Return Index commenced
January 1, 2003.
MONTHLY
INSIGHT
|
PORTFOLIO IN
FULL
|
|||||||||||||||||||||
|
Company
|
% of
|
||||||||||||||||||||
|
Sector
|
(BGB
ticker)
|
Price
|
Holding
|
Value US$
|
net assets
|
||||||||||||||||
|
ELECTRONICS
|
26.2 | ||||||||||||||||||||
|
Wah Lee
Industrial
|
3010 |
TT
|
NT$61.1 | 6,644,000 | $13,981,106 | 3.6 | |||||||||||||||
|
Synnex Technology
International
|
2347 |
TT
|
NT$76.6 | 4,238,544 | $11,181,914 | 2.8 | |||||||||||||||
|
Wistron
NeWeb
|
6285 |
TT
|
NT$87.2 | 3,219,000 | $9,667,366 | 2.5 | |||||||||||||||
|
WT
Microelectronics
|
3036 |
TT
|
NT$47.5 | 5,056,000 | $8,271,254 | 2.1 | |||||||||||||||
|
Far EasTone
Telecommunications
|
4904 |
TT
|
NT$43.5 | 4,924,000 | $7,376,970 | 1.9 | |||||||||||||||
|
Powercom
|
3043 |
TT
|
NT$68.3 | 2,805,000 | $6,598,181 | 1.7 | |||||||||||||||
|
Tatung
|
2371 |
TT
|
NT$6.8 | 26,073,000 | $6,124,154 | 1.5 | |||||||||||||||
|
WPG
Holdings
|
3702 |
TT
|
NT$57.2 | 2,947,725 | $5,807,025 | 1.5 | |||||||||||||||
|
Longwell
|
6290 |
TT
|
NT$44.6 | 3,614,000 | $5,551,287 | 1.4 | |||||||||||||||
|
MPI
|
6223 |
TT
|
NT$121.0 | 1,098,000 | $4,575,709 | 1.2 | |||||||||||||||
|
Taiwan Surface Mounting
Technology
|
6278 |
TT
|
NT$75.5 | 1,632,000 | $4,243,633 | 1.1 | |||||||||||||||
|
Aurora
|
2373 |
TT
|
NT$49.9 | 2,196,000 | $3,770,233 | 1.0 | |||||||||||||||
|
Chunghwa
Telecom
|
2412 |
TT
|
NT$89.2 | 1,190,400 | $3,657,029 | 0.9 | |||||||||||||||
|
Clevo
|
2362 |
TT
|
NT$64.0 | 1,650,000 | $3,636,927 | 0.9 | |||||||||||||||
|
Avermedia
Technologies
|
2417 |
TT
|
NT$39.2 | 2,690,000 | $3,631,692 | 0.9 | |||||||||||||||
|
Advantech
|
2395 |
TT
|
NT$89.7 | 900,000 | $2,780,390 | 0.7 | |||||||||||||||
|
Syncmold
Enterprise
|
1582 |
TT
|
NT$48.7 | 771,000 | $1,293,165 | 0.3 | |||||||||||||||
|
Soft-World
International
|
5478 |
TT
|
NT$139.0 | 154,770 | $740,922 | 0.2 | |||||||||||||||
|
FINANCE
|
16.7 | ||||||||||||||||||||
|
Chinatrust Financial
Holding
|
2891 |
TT
|
NT$24.8 | 16,067,000 | $13,723,256 | 3.5 | |||||||||||||||
|
SinoPac Financial
Holdings
|
2890 |
TT
|
NT$14.1 | 26,935,000 | $13,079,971 | 3.3 | |||||||||||||||
|
KGI
Securities
|
6008 |
TT
|
NT$16.9 | 20,740,000 | $12,035,922 | 3.1 | |||||||||||||||
|
Yuanta Financial
Holding
|
2885 |
TT
|
NT$23.6 | 13,013,000 | $10,554,533 | 2.7 | |||||||||||||||
|
Fubon Financial
Holding
|
2881 |
TT
|
NT$40.6 | 7,349,624 | $10,276,893 | 2.6 | |||||||||||||||
|
China Life
Insurance
|
2823 |
TT
|
NT$30.5 | 4,191,254 | $4,402,654 | 1.1 | |||||||||||||||
|
Union Bank of Taiwan
|
2838 |
TT
|
NT$11.8 | 4,408,000 | $1,783,816 | 0.4 | |||||||||||||||
|
WHOLESALE AND
RETAIL
|
13.2 | ||||||||||||||||||||
|
Far Eastern Department
Stores
|
2903 |
TT
|
NT$51.9 | 8,794,500 | $15,719,879 | 4.0 | |||||||||||||||
|
President Chain
Store
|
2912 |
TT
|
NT$124.0 | 2,840,000 | $12,128,601 | 3.1 | |||||||||||||||
|
Test-Rite
International
|
2908 |
TT
|
NT$21.8 | 10,622,000 | $7,975,051 | 2.0 | |||||||||||||||
|
Taiwan Tea
|
2913 |
TT
|
NT$20.8 | 8,231,000 | $5,882,222 | 1.5 | |||||||||||||||
|
Mercuries &
Associates
|
2905 |
TT
|
NT$22.9 | 6,680,100 | $5,257,023 | 1.3 | |||||||||||||||
|
PC Home
Online
|
8044 |
TT
|
NT$159.0 | 922,125 | $5,049,607 | 1.3 | |||||||||||||||
|
CONSTRUCTION
|
6.6 | ||||||||||||||||||||
|
Taiwan Land
Development
|
2841 |
TT
|
N$T16.1 | 14,586,183 | $8,087,946 | 2.1 | |||||||||||||||
|
Prince Housing &
Development
|
2511 |
TT
|
NT$21.3 | 9,899,760 | $7,262,313 | 1.8 | |||||||||||||||
|
Hung Poo Real Estate
Development
|
2536 |
TT
|
NT$46.6 | 3,061,000 | $4,907,425 | 1.2 | |||||||||||||||
|
Continental
Holdings
|
3703 |
TT
|
NT$13.2 | 7,468,000 | $3,382,211 | 0.9 | |||||||||||||||
|
King’s Town
Construction
|
2524 |
TT
|
NT$34.9 | 1,184,000 | $1,423,141 | 0.4 | |||||||||||||||
|
Good Friend International
Holdings
|
912398 |
TT
|
NT$24.0 | 825,000 | $680,503 | 0.2 | |||||||||||||||
|
PLASTICS
|
5.7 | ||||||||||||||||||||
|
China Petrochemical
Development
|
1314 |
TT
|
NT$33.1 | 11,711,000 | $13,330,184 | 3.4 | |||||||||||||||
|
Nan Ya
Plastics
|
1303 |
TT
|
NT$80.5 | 3,217,000 | $8,919,030 | 2.3 | |||||||||||||||
|
TEXTILES
|
4.0 | ||||||||||||||||||||
|
Li Peng Enterprise
|
1447 |
TT
|
NT$18.5 | 9,847,000 | $6,257,070 | 1.6 | |||||||||||||||
|
Far Eastern New
Century
|
1402 |
TT
|
NT$49.6 | 3,121,200 | $5,326,427 | 1.3 | |||||||||||||||
|
Makalot
Industrial
|
1477 |
TT
|
NT$68.4 | 1,828,000 | $4,306,287 | 1.1 | |||||||||||||||
|
Company
|
% of
|
||||||||||||||||||||
|
Sector
|
(BGB
ticker)
|
Price
|
Holding
|
Value US$
|
net assets
|
||||||||||||||||
|
FOODS
|
3.8 | ||||||||||||||||||||
|
Uni-President
Enterprises
|
1216 |
TT
|
NT$39.9 | 6,600,000 | $9,069,587 | 2.3 | |||||||||||||||
|
Lien Hwa
Industrial
|
1229 |
TT
|
NT$23.1 | 4,815,000 | $3,822,416 | 1.0 | |||||||||||||||
|
Gourmet
Master
|
2723 |
TT
|
NT$298.5 | 204,000 | $2,097,226 | 0.5 | |||||||||||||||
|
ELECTRIC AND
MACHINERY
|
3.0 | ||||||||||||||||||||
|
Yungtay
Engineering
|
1507 |
TT
|
NT$41.2 | 3,274,000 | $4,640,013 | 1.2 | |||||||||||||||
|
Depo Auto Parts
Industrial
|
6605 |
TT
|
NT$73.4 | 1,674,000 | $4,231,772 | 1.1 | |||||||||||||||
|
Awea
Mechantronic
|
1530 |
TT
|
NT$38.1 | 2,260,000 | $2,965,542 | 0.7 | |||||||||||||||
|
STEEL AND
IRON
|
3.0 | ||||||||||||||||||||
|
Tung Ho Steel Enterprise
|
2006
|
TT
|
NT$34.4 | 10,099,000 | $11,947,466 | 3.0 | |||||||||||||||
|
CHEMICALS
|
2.9 | ||||||||||||||||||||
|
China Steel
Chemical
|
1723 |
TT
|
NT$122.0 | 1,600,000 | $6,722,805 | 1.7 | |||||||||||||||
|
Excelsior
Medical
|
4104 |
TT
|
NT$88.0 | 1,507,729 | $4,569,584 | 1.2 | |||||||||||||||
|
OTHERS
|
2.7 | ||||||||||||||||||||
|
Yem Chio
|
4306 |
TT
|
NT$27.4 | 5,701,316 | $5,380,175 | 1.4 | |||||||||||||||
|
Globe Union
Industrial
|
9934 |
TT
|
NT$29.5 | 5,128,000 | $5,210,036 | 1.3 | |||||||||||||||
|
HEALTHCARE
|
2.3 | ||||||||||||||||||||
|
ST Shine
Optical
|
1565 |
TT
|
NT$368.0 | 392,000 | $4,968,263 | 1.3 | |||||||||||||||
|
Pacific Hospital Supply
|
4126 |
TT
|
NT$109.0 | 1,099,948 | $4,129,233 | 1.0 | |||||||||||||||
|
RUBBER
|
2.0 | ||||||||||||||||||||
|
TSRC
|
2103 |
TT
|
NT$75.8 | 3,057,000 | $7,980,596 | 2.0 | |||||||||||||||
|
GLASS AND
CERAMICS
|
1.5 | ||||||||||||||||||||
|
Taiwan Glass
Industrial
|
1802 |
TT
|
NT$38.9 | 4,481,320 | $6,003,800 | 1.5 | |||||||||||||||
|
TRANSPORTATION
|
1.4 | ||||||||||||||||||||
|
Farglory F T Z
Investment
|
5607 |
TT
|
NT$31.5 | 3,809,000 | $4,132,303 | 1.1 | |||||||||||||||
|
Taiwan High Speed
Rail
|
2633 |
TT
|
NT$6.0 | 5,868,000 | $1,214,606 | 0.3 | |||||||||||||||
|
CEMENT
|
0.7 | ||||||||||||||||||||
|
Wei Mon
Industry
|
8925 |
TT
|
NT$20.0 | 4,204,296 | $2,895,969 | 0.7 | |||||||||||||||
|
OTHER ASSETS AND
LIABILITIES
|
$17,019,315 | 4.3 | |||||||||||||||||||
MONTHLY INSIGHT
THE TAIWAN FUND, INC.
PREMIUM/DISCOUNT
Source: State Street Bank and Trust
Company as of January 31, 2011.
INDEX DESCRIPTIONS
MSCI Taiwan Index
The MSCI Total Return Taiwan Index is a
free-float adjusted market capitalization index. The index represents Taiwanese
companies that are available to investors worldwide. The Index has a base date
of December 31, 1987. As of June 24, 2010 it contained 117
constituents.
TAIEX Index
The TWSE, or TAIEX Index is a
capitalization-weighted index of all listed common shares traded on the Taiwan
Stock Exchange. The index was based in 1966 and does not include re-invested
dividends.
TAIEX Total Return
Index
The TAIEX Total Return Index is a
capitalization-weighted index of all listed common shares traded on the Taiwan
Stock Exchange, based in 1966, which includes re-invested
dividends.
OBJECTIVE
The Fund was launched on December 23,
1986 to allow US and other investors to access and participate in the growth of
the economy and the stock market in Taiwan, the Republic of China. The Fund’s
investment objective is to seek long-term capital appreciation primarily through
investments in equity securities listed in Taiwan. The Fund is a diversified, closed-end
management investment company listed on the New York Stock Exchange (NYSE) under
the symbol ‘TWN’.
Taiwan, with its global market leadership in
high technology goods and its significant investments throughout mainland
China and Southeast Asian economies, is now
an integral economic player in the Asia Pacific Region as well as around the
world. Investing in Taiwan not only allows investors to capitalize
on Taiwan’s dynamic economy, but also allows
investors to reap the growth and investment potential of the mainland
China and other emerging economies of the
region.
CONTACTS
The Taiwan Fund,
Inc.
c/o State Street Bank and Trust Company
2 Avenue de Lafayette
PO Box 5049
Boston, MA 02111
Tel: (1)
877-864-5056
www.thetaiwanfund.com
IMPORTANT
INFORMATION
This document is issued and approved by
Martin Currie Inc (MC Inc), as investment adviser of The Taiwan Fund, Inc. (the
‘Fund’). MC Inc is authorised and regulated by the Financial Services Authority
(FSA) and incorporated under limited liability in New York, USA. Registered in Scotland (No BR2575), registered address
Saltire Court, 20 Castle Terrace, Edinburgh, EH1 2ES. Information herein is believed to be
reliable but has not been verified by MC Inc. MC Inc makes no representation or
warranty and does not accept any responsibility in relation to such information
or for opinion or conclusion which the reader may draw from this newsletter.
The Fund is classified as a diversified
investment company under the US Investment Company Act of 1940 as amended. It
meets the criteria of a closed ended US mutual fund and its shares are listed
on the New York Stock Exchange. MC Inc has been appointed investment adviser to
the Fund.
Investors are advised that they will not
generally benefit from the rules and regulations of the United Kingdom Financial
Services and Markets Act 2000 and the FSA for the protection of investors, nor
benefit from the United Kingdom Financial Services Compensation Scheme, nor have
access to the Financial Services Ombudsman in the event of a dispute. Investors
will also have no rights of cancellation under the FSA’s Conduct of Business
Sourcebook of the United
Kingdom.
This newsletter does not constitute an
offer of shares. MC Inc, its ultimate and intermediate holding companies,
subsidiaries, affiliates, clients, directors or staff may, at any time, have a
position in the market referred to herein, and may buy or sell securities,
currencies, or any other financial instruments in such markets. The information
or opinion expressed in this newsletter should not be construed to be a
recommendation to buy or sell the securities, commodities, currencies or
financial instruments referred to herein.
The information provided in this report
should not be considered a recommendation to purchase or sell any particular
security. There is no assurance that any securities discussed herein will remain
in an account’s portfolio at the time you receive this report or that securities
sold have not been repurchased.
It should not be assumed that any of the
securities transactions or holdings discussed here were or will prove to be
profitable, or that the investment recommendations or decisions we make in the
future will be profitable or will equal the investment performance of the
securities discussed herein.
Investing in the Fund involves certain
considerations in addition to the risks normally associated with making
investments in securities. The value of the shares issued by the Fund, and the
income from them, may go down as well as up and there can be no assurance that
upon sale, or otherwise, investors will receive back the amount originally
invested. There can be no assurance that you will receive comparable performance
returns, or that investments will reflect the performance of the stock examples
contained in this document. Movements in foreign exchange rates may have a
separate effect, unfavorable as well as favorable, on the gain or loss otherwise
experienced on an investment. Past performance is not a guide to future returns.
Accordingly, the Fund is only suitable for investment by investors who are able
and willing to withstand the total loss of their investment. In particular,
prospective investors should consider the following risks:
® it should be noted that investment in
the Fund is only suitable for sophisticated investors who are aware of the risk
of investing in Taiwan and should be regarded as long term.
Funds which invest in one country carry a higher degree of risk than those with
portfolios diversified across a number of markets.
® investment in the securities of smaller
and unquoted companies can involve greater risk than is customarily associated
with investment in larger, more established, companies. In particular, smaller
companies often have limited product lines, markets or financial resources and
their management may be dependent on a smaller number of key individuals. In
addition, the market for stock in smaller companies is often less liquid than
that for stock in larger companies, bringing with it potential difficulties in
acquiring, valuing and disposing of such stock. Proper information for
determining their value, or the risks to which they are exposed, may not be
available.
® investments within emerging markets such
as Taiwan can be of higher risk. Many emerging
markets, and the companies quoted on their stock exchanges, are exposed to the
risks of political, social and religious instability, expropriation of assets or
nationalization, rapid rates of inflation, high interest rates, currency
depreciation and fluctuations and changes in taxation which may affect the
Fund’s income and the value of its investments.
® the marketability of quoted shares may
be limited due to foreign investment restrictions, wide dealing spreads,
exchange controls, foreign ownership restrictions, the restricted opening of
stock exchanges and a narrow range of investors. Trading volume may be lower
than on more developed stockmarkets, and equities are less liquid. Volatility of
prices can also be greater than in more developed stockmarkets. The
infrastructure for clearing, settlement and registration on the primary and
secondary markets may be undeveloped. Under certain circumstances, there may be
delays in settling transactions in some of the markets.
Martin Currie Inc, registered in
Scotland (no BR2575)
Registered office: Saltire Court, 20 Castle Terrace, Edinburgh EH1 2ES
Tel: 44 (0) 131 229 5252 Fax: 44 (0) 131
228 5959 www.martincurrie.com
North American office: 1350 Avenue of
the Americas, Suite 3010, New York, NY
10019, USA Tel: (1) 212 258 1900 Fax: (1) 212 258
1919
Authorised and registered by the
Financial Services Authority and incorporated with
limited liability in New York, USA.
Please note: calls to the above numbers
may be recorded.