Rolle im Portfolio
The fund provides exposure to large- and mid-cap stocks within several of the developed Asian markets, outside of Japan. The MSCI Pacific ex-Japan Index is diversified across a fairly large number of individual constituents, but is narrowly focused in two ways. On a geographic basis, almost two-thirds of the index is made up of Australian stocks, and on an industry basis, two-thirds come from financials and materials. As a result, this fund is best viewed as a tactical position in Asia’s developed markets, particularly Australia.
As the fund does not pay out distributions, it may not suit an investor looking for regular investment income.
Fundamentale Analyse
Although the MSCI Pacific ex-Japan index covers many countries, Australia has the largest influence, accounting for over half of the total weighting.
Thanks to its vast supply of natural resources, Australia’s economy has consistently expanded, averaging 3.5% GDP growth per year for the last 20 years, and the Reserve Bank of Australia expects growth to reach up to 3% in 2015. While a mining boom had driven much of the growth in recent years, A mining industry activity has since levelled off. Meanwhile, a surge in liquefied natural gas (LNG) exports has become one of the main drivers of GDP growth, which will continue to tie Australia’s economic trajectory to China. China has already become the second largest importer of Australia’s LNG, due to its growing demand for resources to aid China’s investment in national infrastructure.
Australia’s financial sector (accounting for over 50% of the index) has made strides since the 2008 global financial crisis but is not immune from potential pitfalls. Although Australia’s financial sector has outperformed peer nations since the global financial crisis, the IMF has advised it can better manage risks from high household debt and house prices, decrease its reliance on overseas funding and increase competitiveness beyond the top four banks which currently dominate the field.
Indexkonstruktion
The MSCI Pacific ex-Japan Index is a free-float market capitalisation-weighted index currently consisting of over 140 constituents. The index covers approximately 85% of the free float-adjusted market capitalisation of these markets. New entrants must pass minimum requirements for liquidity and length of trading history. It is reviewed quarterly, and rebalanced semi-annually with new size cut-offs calculated. The index’s top country weights are Australia (57-63%), Hong Kong (23-28%) and Singapore (10-15%). Financials are by far the biggest sector component (50-56%), followed by materials and industrials (5-10% each). There is meaningful portfolio concentration, with the top 10 names making up about 30% of the total. The top constituents are Commonwealth Bank of Australia (5-10%), Westpac Banking (5-8%) and Australia and New Zealand Banking Group (4-7%).
Fondskonstruktion
This fund uses full replication to track the performance of the MSCI Pacific ex-Japan total return index, which means that it aims to hold all the index constituents at the same weight as stipulated by the index. The fund uses futures for cash equitisation purposes, which helps to minimise tracking error. The combined weight of these components is capped at 2% of the portfolio’s value, although internally a 1% target is aimed for. The fund engages in securities lending to enhance returns. In the 12 months through May 2015, an average of 1.26% of the portfolio was out on loan, up to a maximum of 4.83%. The lending programme added less than 1 basis point of net return to the fund. The amount of securities that can be lent is capped to 50% per fund. Deutsche Bank Agency Securities Lending (DB ASL) acts as the lending agent. Lending revenue is split 70/30 between the ETF and the lending agent, respectively.
Gebühren
The fund’s total expense ratio (TER) is 0.45%. Other costs potentially borne by the unitholder but not included in the TER include transaction costs, and bid-ask spreads and brokerage fees when buy and sell orders are placed for ETF shares.
Alternativen
To get exposure to equities in the Asia ex-Japan region, there are a few choices, albeit referencing different underlying indices and with less exposure to Australia. Possible alternatives include Amundi ETF MSCI Pacific ex-Japan, Vanguard FTSE Developed Asia Pacific ex Japan, iShares MSCI AC Far East ex Japan, iShares Core MSCI Pacific ex Japan Lyxor ETF MSCI AC Asia ex-Japan, UBS-ETF MSCI Pacific (ex-Japan) and HSBC MSCI Pacific ex-Japan. The iShares Core MSCI Pacific ex Japan fund has the lowest TER, at 0.20%.
