2nd Nov 2018 14:30
LONDON (Alliance News) - Henderson Far East Income Ltd on Friday said its net asset value shrank in its most recent year as a consequence of a strengthened US dollar and concerns around US trade policies.
Shares in the Asia Pacific-focused investor were down 2.0% at 345.92 pence on Friday afternoon.
As at August 31, the trust's net asset value per share stood at 359.26p, dropping from 375.19p the year before, due to rising US interest rates and a strong US dollar, as well as an increase in protectionist US policies which contributed to uncertainty.
The share price to net asset value moved to a 0.6% discount on a total return basis from a 1.3% premium the prior year.
Henderson Far East's net asset total return for the year to August was 1.5%, ahead of the MSCI AC Asia Pacific ex Japan High Dividend Yield Index's 0% return, but behind the sterling-adjusted FTSE All- World Asia Pacific ex Japan Index's return of 2.4%.
A fourth interim dividend of 5.50p per share was declared for the period, bringing the total dividend for the year to 21.60p per share from 20.80p the year before.
The chairman of Henderson Far East, John Russell, began his outlook statement in rather stark terms: "The outlook for the world we know best, the post WW2 liberal democracy, which created the elevated standard of living we enjoy, is under threat".
"It is not possible to conjecture how this might unfold and what the consequences might be," he continued.
Russell then went on to state his belief that China will become more dominant "as US global engagement declines", adding up to a "strong investment case for the region".
"In a troubled world, portfolio diversification is even more important than normal. Despite the risks, the Asia Pacific region remains an attractive investment destination particularly for savers taking a medium to long term view and seeking growing levels of income," said Russell.
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