Manulife launches preferred securities income fund

Manulife said its Preferred Securities Income Fund is suitable for investors who seek regular income and potential capital appreciation, investment exposure in preferred securities globally, as well as those who have a long-term investment horizon.

KUALA LUMPUR: Manulife Investment Management (M) Bhd has launched the Manulife Preferred Securities Income Fund, an alternative investment solution that provides equity-like capital growth features and bond-like income streams.

The globally-oriented fund invests in preferred securities issued by companies that are defensive in nature, such as banks, utilities, and real estate investment trusts (REITs), which are usually large and highly regulated organisations with stable cash flows, Manulife said in a statement on Monday.

"Depending on the level of income (if any) the fund generates, the fund aims to distribute all or part of its distributable income on a quarterly basis, ” the asset management company said.

Manulife said its Preferred Securities Income Fund is suitable for investors who seek regular income and potential capital appreciation, investment exposure in preferred securities globally, as well as those who have a long-term investment horizon.

The fund is available in A (ringgit-hedged) Class and A (US dollar) Class with a minimum initial investment of RM1,000 or US$1,000 (US$1= RM4.156), and a minimum additional investment of RM100 or US$100.

Chief executive officer Jason Chong said while challenging economic conditions impact most assets, preferred securities’ dependence on more established issuers -- largely investment grade companies with low historical default rates -- makes the fund well-placed to navigate the current challenges.

Retail wealth distribution head Ng Chze How believed preferred securities may be a viable option for income-seeking investors due to the current uncertain situation.

"Uncertainty is still the predominant theme and we can expect this to continue as we head into 2021.

"Under such circumstances, investment options that could provide relatively stable income and returns may give investors in Malaysia some comfort, ” he said. - Bernama