Hang Seng Bank has announced that it is launching its first capital-guaranteed funds for those individuals interested in investing in the technology sector through funds that come with minimal risk and have no subscription fee.
Called the Hang Seng Capital Guaranteed Technology Fund Series the vehicle will offer two capital guaranteed funds: one with 100% capital guaranteed and a further fund with 90% capital guaranteed - both are with an investment period of two years. The funds will be available for subscription from 12 February to 2 March 2001. The bank states that it will provide the guarantee on the capital for investors who hold their units to the maturity date of 5 March 2003.
Managed by Hang Seng Investment Management Ltd, a portion of the funds will be placed in bonds, money markets and similar investment instruments to generate returns at the respective capital guaranteed levels at maturity. The remainder is expected to be invested across a wide range of industries including technology, media, telecom and related sectors to maximise investment returns.
In a press statement, Mr Cheung Ka-ming, the Bank's Assistant General Manager and Head of Investment Services, said: 'The Hang Seng Capital Guaranteed Technology Fund Series is specially designed for investors who seek higher potential returns in a declining interest rate environment but are cautious about market fluctuations and capital risk. Opportunities in technology investment are arising again with interest rate reductions. Historically, technology stocks have benefited and delivered attractive returns during rate cut cycles.'
He continued: 'In addition, the valuation of these stocks has returned to a more reasonable level after the market correction in 2000. Hang Seng Investment Management will closely monitor market movements and adjust the investment mix accordingly to maximise returns and minimise risks.'
No redemption fee is charged if investors hold their units to the maturity date and premature redemption will be available every Monday subject to market fluctuations with a fee of 2%. The management fee of the funds will also be up to 2% per annum. .
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