Ishr Msci Kor-i Discussion Threads

[davebowler] 05/9/2014 09:53

Westhouse;
Weiss Korea Opportunity Fund (WKOF.L, discount to NAV 4.5%, Buy) has released its interim results for the six months to end-June 2014. These provided shareholders with a strong absolute return of 23.2%. The fund also significantly outperformed its index, the MSCI Korea 25/50 Capped Index (which rose by just 0.75% in Sterling terms), though WKOF’s specialised remit and resultant marked differentiation from this index make comparisons somewhat irrelevant.


Despite such a robust performance over the last yea
r, we have seen the company’s
rating drift from an often elevated premium to a no
table discount. It is therefore
pleasing that yesterday’s results provide a reinfor
cement from the Board of its
willingness and desire to minimise the discount thr
ough an active share buy-back policy.
However, given the strength in performance and the
relatively low correlation of the
WKOF NAV with other asset classes, it is somewhat s
urprising that demand has not
been sufficient to maintain a stronger rating than
has been the case. The board has
stated that it has granted its broker authority to
buy back shares during close periods,
when it is unable to issue instructions on buy-back
s. It has also restated that it has the
authority to repurchase up to 40% of the shares of
the company.


Perhaps one point of concern for investors is the s
uccess rate of the fund to date and
the degree of narrowing of the discount of Korean p
referred shares to their ordinary
counterparts that has already occurred. The latter
is partly reflected in the results
statement, with the average weighted discount of WK
OF’s preferred share portfolio has
narrowed from 49.5% at end-December 2013, to 39.8%
on 30 June 2014. Nonetheless,
the absolute level of discount remains high. Furthe
rmore, prospects for enhanced
legislative reform in Korea (particularly in relati
on to elevated dividend payments by
companies), if these were to occur, could provide f
urther support to recent discount
compression trends if they were to be implemented.



So the risk to investors is that the narrowing on p
referred share pricing seen thus far peters
out or is reversed. This could then merely elevate
risks associated with a single country fund,
many of which in the emerging market space continue
to attract double-digit discounts.
However, it is also worth recognising that many Asi
a ex-Japan funds have a Korean weighting
in excess of 20%. And we would argue that by utilis
ing a fund such as WKOF at its current
level of discount (both headline and see through),
provides investors with a positive point of
complementary exposure to other funds.
Some investors may also be deterred by the evident
concentration risk within the portfolio.
At end-June this included a weighty 12.37% of the f
und exposed to the Samsung Electronics
Preferred Share and just over 26% in multiple share
types of the Hyundai Motor Company.
However, while recognising this risk, we believe th
at the active management of the portfolio,
the reduced correlation with other asset classes an
d prospects for further discount
compression at the portfolio level warrant inclusio
n of WKOF in a diversified pool of funds.
Buy

[davebowler] 04/8/2014 11:17

Here is a back door into the market at a discount to NAV -Weiss Korea Opportunity NAV 143.90 31st July 2014 price 140p

[trader horne] 28/11/2010 21:16

like so many others, had a damn good run this year but now looking toppy and starting to go sideways

[fox tail] 16/12/2008 06:33

is this an etf?

[kiwi2007] 15/12/2008 10:08

Am starting to trickle funds into this and IBZL Brazil ...

[scottishfield] 29/5/2008 07:29

Nice bounce up this morning

[fox tail] 08/4/2008 21:09

no - you know what I mean - like oilb etc - effectively loses value over the underlying.

[richardbees] 08/4/2008 21:07

"is ther a decay rate?"



............is that an anagram?

[fox tail] 08/4/2008 21:05

is ther a decay rate?

[trader horne] 08/4/2008 12:32

now back to the average trend line after a very rough few weeks!

[trader horne] 03/1/2008 16:06

Quuiet thread this! Warren B is into Korea, guess he made the 37% gain of 2007.
I may follow, tho' late in the day; price 1964, NAV 1984 today.

[thomas11] 04/7/2007 19:37

Could,t find a thread to cover this so I created one !!, The charts speak for themselves.

This is an Ishare that you buy on LSE like any other share and it tracks the Korean Index. An easy way to gain Korean exposure to their current bull run after being dormant for some time.