8th Jun 2016 12:18
LONDON (Alliance News) - Schroder AsiaPacific Fund PLC on Wednesday said much of its return in the first half of its financial year came from a fall in the value of sterling, rather than from the performance of the Asian market.
In a statement, Schroder AsiaPacific Fund said its net asset value produced a total return of 11.0% and the share price produced a total return of 12.1% during the six month period ended March 31, compared to a total return of 11.4% for the MSCI All Countries Asia excluding Japan Index in sterling terms over the period.
Given the upcoming June 23 referendum on the UK's membership of the EU, Chairman Nicholas Smith said that sterling could continue to be an "important part of near-term changes" in the company's net asset value.
"That aside, however, Asia's challenge is finding a new growth path. Many of the factors behind its past success - for example labour cost advantages, China's transformation into an economic powerhouse, and positive demographics - no longer underwrite strong stock markets. Share valuations may be below their historic average, but for many investors the point of Asian equities is rapid growth in corporate profits, and the region has not provided that for a while," Smith said in a statement.
Shares in Schroder AsiaPacific Fund were down 0.5% at 271.25 pence Wednesday.
By Samuel Agini; [email protected]; @samuelagini
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