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Meranti Capital VCC Asia Fund (Meranti Asia Fund, MAF)

The Asia ex Japan economies are growing three times faster than developed markets. By end of 2020, Asia's middle class population will exceed that of the rest of the world. By 2030, Asia will have two thirds of the world's middle class; that also makes Asia the largest market for consumer goods & services.*

Meranti Asia Fund seeks to achieve long-term capital appreciation by investing in Asian businesses. Investors need to be aware that investing in Asian equities can be highly rewarding but also very volatile. Building on decades of research^, we use a model-driven approach to identify companies that are well-placed to outperform the market over time. By investing in higher quality businesses with more attractive valuations, we aim to deliver higher returns than the market.

We evaluate over 18,000 companies, assessing their fundamentals for profitability and balance sheet strength. However, companies with good fundamentals alone may not be good investments; we further select companies that are trading at attractive valuations in order to create a margin of safety. While we encourage equity investors to maintain a long-term investment horizon, we manage the liquidity profile of the portfolio to ensure that investors will be able to encash their investment should the need arise. The volatility of Asian markets actually benefits the strategy. Such volatility creates a cycle of mis-pricing and fair valuation that throw up opportunities regularly.

*Homi Kharas (2017), The unprecedented expansion of the global middle class. https://www.brookings.edu/research/the-unprecedented-expansion-of-the-global-middle-class-2/
^Source: Introducing MSCI Factor Indices

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