OSK-UOB's new fund to capitalise on global energy

OSK-UOB Unit Trust Management Bhd, a subsidiary of OSK Investment Bank Bhd, will launch a fund capitalising on opportunities in the global energy sector.

The open-ended OSK-UOB Energy Fund will be launched on Monday, its chief executive officer Ho Seng Yee said in a statement.

"The energy sector is one that the world can't live without. Best of all, the demand for energy is perpetual. Whether it is conventional energy, like crude oil and natural gas, or alternative clean energy, such as biofuel, wind, geothermal and solar, the demand for all these permeate every strata of society. With such potential and possibilities, this is one sector not to be missed," he added.

Ho said that crude oil prices, which have declined substantially from a high of US$147 (RM538) a barrel in July last year to around US$43 (RM157), will likely pick up as demand from emerging economies like China and India increases. At the same time, supply will be tight with limited access to oil reserves and rising cost of production.

"This ongoing demand and supply play between conventional and alternative energy makes this one sector you should not miss. When demand stabilises and trends up, and with supplies hampered and limited, inevitably, another up cycle will appear," he said.

Ho said the fund's exposure to the global energy sector will be through three underlying assets, namely the JPMorgan Commodity Curve Index Energy Excess Return (index), Energy Select Sector SPDR Fund (exchange traded fund) and Powershares WilderHill Clean Energy Portfolio (exchange traded fund), in the ratio of 60:20:20 respectively.

"This fund will benefit and perform with the positive performance of the three underlying assets, which hinges on the expected increase in crude oil prices and deeper growth in the alternative clean energy sector."

The initial approved fund size is 400 million units and initial price, 50 sen per unit. The offer period is from March 23 to April 12.

The minimum investment is RM1,000 and subsequent minimum top-up, RM100