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Products October 22, 2004
UOB Offers IPO Fund
October 22, 2004 (PLANSPONSOR.com) - UOB Asset
Management (UOBAM) has launched a mutual fund to take
positions in global initial public offerings (IPO).
Reported by Fred Schneyer
According to information on the firm’s Web site, the fund will put 60% of its assets in global post-IPOs, (securities issued within 36 months of initial offering), 30% in global IPO placements and up to 10% in pre-IPOs.
The Web site statement warned that the fund may not be suitable for all investors. “Investing in IPOs typically entails extensive research and is associated with high risk due to, amongst other reasons, the lack of diversification,” the company said. “Together with the large subscription amount required for participation, direct investment in IPOs can be a tricky affair.”
UOBAM said the fund also has the flexibility to
hold cash and global interest-bearing securities if there
are no suitable investment opportunities. This gives the
fund two distinct benefits: lower risk and the ability to
take advantage of opportunities as they arise, the
company said.
The performance of the fund is benchmarked to an absolute
return of 6% p.a. The launch period is October 18 to
November 30 and the sales load will be 5%.