3. Private Real Estate
Investment in Private Real Estate or basic infrastructure that is not listed on a public stock market such as office buildings, and electricity and telecommunication projects, can help diversify risks in a volatile market, as well.
Properties with high rental rates offer investors a greater opportunity to enjoy steady returns. Investment in Private Real Estate is ideal for present investment conditions as it offers investors stable cash flows. Long-term investment of at least three years is recommended.
4. Quantitative Hedge Fund
Quantitative Hedge Fund is an alternative fund with greater flexibility in investment strategy. Trust must be placed primarily on the skills of fund managers as they anticipate positive returns regardless of any market conditions.
Quantitative Hedge Fund can invest in a diverse range of asset classes and typically uses a short-selling strategy to make profits during market downturns by borrowing assets to sell first before repurchasing them later at a lesser value or using derivatives to boost the leverage rate or other more complicated strategies, based on mathematical and quantitative statistical methods.
Overall, a quantitative hedge fund can serve as a tool to add new dimensions to investment portfolios in terms of returns and risk diversification.
5. Structured Note
Structured Note is a financial instrument combining the key features of debentures and derivatives. Its investment mechanism is based on asset prices or factors related to market changes in various forms such as stock index, foreign exchange rate, etc.
For instance Structured Note products that are preferred among Thai investors are knock-in knock-out (KIKO) structured notes with Thai or foreign stocks as underlying assets. They will offer good returns at a time when the market is moving in a narrow range, and can provide regular returns in the form of monthly interest.
Subsequently, each asset class is outstanding and can well meet the different needs of investors. Interested investors should study and understand investment details thoroughly or consult professionals for advice on appropriate investment portfolio allocation. In normal practice, alternative assets make up no more than 10 per cent of a total portfolio, as their main purpose is risk diversification.
In closing, Triphon noted, “According to operating results of last year, our alternative asset investment product with outstanding performance and satisfactory returns amid market volatility was K-GPE19A-UI fund, a private equity fund, which offered an average return of up to 19 per cent per annum. Throughout the second half of this year, KBank Private Banking is determined to continually introduce additional alternative investment products both domestically and internationally, and in alignment with investment themes of the future, namely Global Private Debt, Global Private Equity, Global and Local Private Real Estate, Quantitative Hedge Fund Strategy and Exotic Structured Note, as investment options.”