​The first half of 2018 has passed, and this year is believed to be one of the toughest for investments in almost every asset class, whether it be stocks, debt instruments, gold, oil or even real estate, especially when compared to the golden year of 2017 when investors seemed to gain positive returns from whatever assets they had invested in. The situation is different in the second half of 2018, when the global capital markets are vulnerable and under heavy pressure from many factors. There are concerns over accelerated US inflation, further interest rate hikes by the Federal Reserve, uncertainty in the European political scene and the looming international trade war, triggered by US trade protectionist measures against China, which has now spilled over to Europe and is likely to drag on. This is not to mention the fact that stock markets or assets worldwide have steadily increased for almost a decade since the financial crisis in 2008.   


Given this situation, investors may ask, “What should we invest in, or should we not invest in anything at all?" The answer is simple. Of course, we need to continue investing, but should add a little caution. You may have heard the saying, “Don't put all your eggs in one basket", which means you should diversify your portfolio effectively by holding various asset classes.


What role do diversified investments play in achieving returns? First of all, we have to understand that the prices of different asset classes, including stocks, debt instruments, gold, oil or property, move in different directions in each phase of a market cycle. For example, stocks tend to produce good returns during a period of economic recovery. On the contrary, debt instruments or bonds are likely to offer good yields during an economic slump. Therefore, effective investment diversification helps navigate the volatility of the markets, because the returns of various asset classes complement each other.


Another follow-up question of investors wishing to take the risk-diversification approach is what assets they should invest in, and at what amount, to ensure positive returns within their individual level of risk tolerance. Honestly, this question is best answered by an investor advisor, but investment advisory service is not yet widely popular in Thailand or is currently available for only specific groups of investors.


General investors seeking good advice from investment gurus might also consider mutual funds as one of their investment choices. KAsset offers interesting mutual funds ​under the K-FIT group, and manages these multi-asset funds based on a diversified approach. KAsset fund managers can help select funds for investment and determine appropriate investment proportions by using an Optimization Tool developed by our risk management teams to optimize returns with the lowest risk level. KAsset's talented analysts will also gradually adjust the portfolio in response to changing market situations and provide suitable advice to match each individual's needs via K-My Funds, which KBank mutual fund customers can download free of charge.


K-FIT includes K-FITS, K-FITM, K-FITL and K-FITXL funds, which aim to generate annualized returns based on different risk levels at 3, 5.5, 7 and 10 percent, respectively. The funds will invest in various asset classes such as Thai stocks, Thai debt instruments, Asian stocks, Japanese stocks, Indian stocks and basic infrastructure securities. Investors are recommended to hold mutual funds for at least three years to gain the best results. Interested investors can obtain additional information from KAsset or www.kasikornasset.com.


Investors are recommended to study investment products to ensure that they understand these products, investment return conditions and risks before making their investment decisions.


The report was prepared on June 29, 2018, by Mr. Kittikun Tanaratpattanakit, Head of Product Strategy Department, KASIKORN ASSET MANAGEMENT Co., Ltd.


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