Refer to "Technology stocks rally could be more powerful than pandemic play" published in theEdge on 22/06/2020 (https://www.theedgemarkets.com/article/technology-stock-rally-could-be-more-powerful-pandemic-play).
- There is nothing that could stop the IT evolution, the deployment of 5G technologies is the way forward — it is exactly this belief that has attracted an influx of bargain hunters to the semiconductor-related stocks on Bursa Malaysia while others are shovelling money to the rubber glove counters.
- Fund managers view that the stellar performance of technology stocks is justifiable, given the significance of the deployment of technologies in more devices that are seen to be developed in the age of Internet of Things (IoT). This will bode well for semiconductor-related players.
- Asset management firm Areca Capital Sdn Bhd’s chief executive officer Danny Wong commented that “it doesn’t matter if the pandemic is here to stay or not, relevant technology stocks will only continue to see growth.”
- “Post-lockdown, people will realise more of the importance of semiconductor especially for the relevance in powering 5G technology and data transmissions and this will be a global phenomenon,” said Lim, adding that the bullish sentiment on the US Nasdaq board has spilled over to Bursa Malaysia.
Global Technology funds available
- Principal Global Technology Fund - MYR Hedged
- Robotech RM Hedged by AmFunds
- TA Global Technology Fund
- United Global Technology - MYR
About the funds
- Principal Global Technology Fund - MYR Hedged (fund fact sheet 30/4/2020)
- For high-networth clients only!
- formerly known as CIMB-Principal Global Technology Fund)-Class MYR Hedged
- The Fund aims to provide capital appreciation through investments in one collective investment scheme, which invests primarily in a diversified portfolio of technology related companies.
- Fund Inception: 17 May 2018.
- Top ten holdings: MICROSOFT CORP, AMAZON.COM INC, ALIBABA GROUP HOLDING LTD, APPLE, SALESFORCE.COM, MASTERCARD, VISA, WORKDAY INC, SERVICENOW, TENCENT HOLDINGS LTD.
- Robotech RM Hedged (fund fact sheet May 2020)
- For high-networth clients only!
- Invest at least 95% in AXA World Funds - Framlington Robotech.
- Top five holdings: Keyence Corp, Intuitive Surgical, Alphabet Inc, Amazon.com, Dexcom.
- Fund Launch Date: 8/8/2018.
- TA Global Technology Fund (fund fact sheet 30/4/2020)
- Fund Objective: The Fund aims to seek long term capital appreciation by investing in a collective investment scheme which invests mainly in a globally diversified portfolio of technology related companies.
- Three Years Fund Volatility: 14.1 (Very High)
- Fund Inception Date: 26 May 2011
- Top Ten Holdings: MICROSOFT, APPLE, ALPHABET, FACEBOOK, TENCENT, AMAZON.COM, VISA, SAMSUNG ELECTRONICS, ALIBABA GROUP, NVIDIA.
- Distribution/Unit Split History: No distribution since 2013 but unit split almost every year.
- United Global Technology - MYR (fund fact sheet 30/4/2020)
- For high-networth clients only!
- Launch Date: Oct 23, 2017
- The Fund seeks to provide long term capital appreciation by investing in the T. Rowe Price Funds SICAV – Global Technology Equity Fund (“Target Fund”) which invests in a diversified portfolio of stocks of globaltechnology companies.
- Top five holdings: ALIBABA GROUP HOLDING, AMAZON.COM, NETFLIX, SALESFORCE.COM, FACEBOOK, SERVICENOW, WORKDAY, ALPHABET, INTUIT, ATLASSIAN.
About the companies invested:
- ALIBABA GROUP HOLDING: Alibaba Group Holding Limited (also known as Alibaba Group and as Alibaba.com) is a Chinese multinational technology company specializing in e-commerce, retail, Internet, and technology. Founded on 4 April 1999 in Hangzhou, Zhejiang, the company provides consumer-to-consumer (C2C), business-to-consumer (B2C), and business-to-business (B2B) sales services via web portals, as well as electronic payment services, shopping search engines and cloud computing services. It owns and operates a diverse array of businesses around the world in numerous sectors. (Source: Wikipedia)
- Alphabet Inc: Alphabet Inc. is an American multinational conglomerate headquartered in Mountain View, California. It was created through a restructuring of Google on October 2, 2015, and became the parent company of Google and several former Google subsidiaries. The two founders of Google assumed executive roles in the new company, with Larry Page serving as CEO and Sergey Brin as president. Alphabet is the world's fourth-largest technology company by revenue and one of the world's most valuable companies. (Source: Wikipedia)
- AMAZON.COM INC: Amazon.com, Inc., is an American multinational technology company based in Seattle that focuses on e-commerce, cloud computing, digital streaming, and artificial intelligence. It is considered one of the Big Four technology companies, along with Google, Apple, and Microsoft. It has been referred to as "one of the most influential economic and cultural forces in the world" as well as the world's most valuable brand. (Source: Wikipedia)
- APPLE: Apple Inc. is an American multinational technology company headquartered in Cupertino, California, that designs, develops, and sells consumer electronics, computer software, and online services. It is considered one of the Big Tech technology companies, alongside Amazon, Google, Microsoft and Facebook. (Source: Wikipedia)
- ATLASSIAN: Atlassian Corporation Plc is an Australian enterprise software multinational that develops products for software development, project management, and content management. It is best known for its issue tracking application Jira, and its team collaboration and wiki product Confluence. Atlassian serves over 135,000 customers. (Source: Wikipedia)
- Dexcom: DexCom, Inc. is a company that develops, manufactures, and distributes continuous glucose monitoring systems for diabetes management. It operates internationally with headquarters in San Diego, California. (Source: Wikipedia)
- FACEBOOK: Facebook, Inc. is an American social media conglomerate corporation based in Menlo Park, California. It was founded by Mark Zuckerberg, along with his fellow roommates and students at Harvard College, who were Eduardo Saverin, Andrew McCollum, Dustin Moskovitz and Chris Hughes, originally as TheFacebook.com—today's Facebook, a popular global social networking website. Facebook is one of the world's most valuable companies. It is considered one of the Big Five technology companies along with Microsoft, Amazon, Apple, and Google. (Source: Wikipedia)
- INTUIT: Intuit Inc. is an American business and financial software company that develops and sells financial, accounting, and tax preparation software and related services for small businesses, accountants, and individuals. The company is headquartered in Mountain View, California. As of 2019, more than 95% of its revenues and earnings come from its activities within the United States. Intuit's products include the tax preparation application TurboTax and the small business accounting program QuickBooks. (Source: Wikipedia)
- Intuitive Surgical: Intuitive Surgical, Inc. is an American corporation that develops, manufactures, and markets robotic products designed to improve clinical outcomes of patients through minimally invasive surgery, most notably with the da Vinci Surgical System. The company is part of the NASDAQ-100 and S&P 500. As of December 31, 2019, Intuitive Surgical had an installed base of 5,582 da Vinci Surgical Systems, including 3,531 in the U.S., 977 in Europe, 780 in Asia, and 294 in the rest of the world. (Source: Wikipedia)
- Keyence Corp: Keyence Corporation (キーエンス, Kīensu) is a direct sales organization that develops and manufactures automation sensors, vision systems, barcode readers, laser markers, measuring instruments, and digital microscopes. Keyence is fabless (fabrication-less) - although it is a manufacturer; it specializes solely in product planning and development and does not manufacture the final products. Keyence products are manufactured at qualified contract manufacturing companies. (Source: Wikipedia)
- MASTERCARD: Mastercard Incorporated (stylized as MasterCard from 1979 to 2016 and mastercard since 2016) is an American multinational financial services corporation headquartered in the Mastercard International Global Headquarters in Purchase, New York, United States. Throughout the world, its principal business is to process payments between the banks of merchants and the card-issuing banks or credit unions of the purchasers who use the "Mastercard" brand debit, credit and prepaid cards to make purchases. Mastercard Worldwide has been a publicly traded company since 2006. Prior to its initial public offering, Mastercard Worldwide was a cooperative owned by the more than 25,000 financial institutions that issue its branded cards. (Source: Wikipedia)
- MICROSOFT CORP: Microsoft Corporation is an American multinational technology company with headquarters in Redmond, Washington. It develops, manufactures, licenses, supports, and sells computer software, consumer electronics, personal computers, and related services. Its best known software products are the Microsoft Windows line of operating systems, the Microsoft Office suite, and the Internet Explorer and Edge web browsers. Its flagship hardware products are the Xbox video game consoles and the Microsoft Surface lineup of touchscreen personal computers. In 2016, it was the world's largest software maker by revenue (currently Alphabet/Google has more revenue). The word "Microsoft" is a portmanteau of "microcomputer" and "software". Microsoft is ranked No. 30 in the 2018 Fortune 500 rankings of the largest United States corporations by total revenue. It is considered one of the Big Five technology companies alongside Amazon, Apple, Google, and Facebook. (Source: Wikipedia)
- NETFLIX: Netflix, Inc. is an American media-services provider and production company headquartered in Los Gatos, California, founded in 1997 by Reed Hastings and Marc Randolph in Scotts Valley, California. The company's primary business is its subscription-based streaming service which offers online streaming of a library of films and television programs, including those produced in-house. As of April 2020, Netflix had over 182 million paid subscriptions worldwide, including 69 million in the United States. Today, the company produces and distributes content from countries all over the globe. (Source: Wikipedia)
- NVIDIA: Nvidia Corporation, commonly referred to as Nvidia, is an American technology company incorporated in Delaware and based in Santa Clara, California. It designs graphics processing units (GPUs) for the gaming and professional markets, as well as system on a chip units (SoCs) for the mobile computing and automotive market. Its primary GPU product line, labeled "GeForce", is in direct competition with Advanced Micro Devices' (AMD) "Radeon" products. Nvidia expanded its presence in the gaming industry with its handheld Shield Portable, Shield Tablet, and Shield Android TV. (Source: Wikipedia)
- SALESFORCE.COM: Salesforce.com, inc. is an American cloud-based software company headquartered in San Francisco, California. It provides customer relationship management (CRM) service and also sells a complementary suite of enterprise applications focused on customer service, marketing automation, analytics, and application development. (Source: Wikipedia)
- SAMSUNG ELECTRONICS: Samsung Electronics Co., Ltd. (Korean: 삼성전자; Hanja: 三星電子; RR: Samsung Jeonja; literally 'tristar electronics') is a South Korean multinational electronics company headquartered in Suwon, South Korea. It is the pinnacle of the Samsung chaebol, accounting for 70% of the group's revenue in 2012. Samsung Electronics has played a key role in the group's corporate governance due to circular ownership. Samsung Electronics has assembly plants and sales networks in 80 countries and employs around 308,745 people. It is the world's largest manufacturer of consumer electronics by revenue. As of 2019, Samsung Electronics is the world's second largest technology company by revenue and its market capitalization stood at US$301.65 billion, the 18th largest in the world. (Source: Wikipedia)
- SERVICENOW: ServiceNow (Service-now in 2011) is an American software company based in Santa Clara, California that develops a cloud computing platform to help companies manage digital workflows for enterprise operations. Founded in 2004 by Fred Luddy, ServiceNow is listed on the New York Stock Exchange and is a constituent of the Russell 1000 Index and S&P 500 Index. (Source: Wikipedia)
- TENCENT HOLDINGS LTD: Tencent Holdings Ltd. (Chinese: 腾讯; pinyin: Téngxùn) is a Chinese multinational conglomerate holding company founded in 1998, whose subsidiaries specialise in various Internet-related services and products, entertainment, artificial intelligence and technology both in China and globally. Its twin-skyscrapers headquarters Tencent Seafront Towers (also known as Tencent Binhai Mansion) are based in Nanshan District, Shenzhen. (Source: Wikipedia)
- VISA: Visa Inc. is an American multinational financial services corporation headquartered in Foster City, California, United States. It facilitates electronic funds transfers throughout the world, most commonly through Visa-branded credit cards, debit cards and prepaid cards. Visa does not issue cards, extend credit or set rates and fees for consumers; rather, Visa provides financial institutions with Visa-branded payment products that they then use to offer credit, debit, prepaid and cash-access programs to their customers. In 2015, the Nilson Report, a publication that tracks the credit card industry, found that Visa's global network (known as VisaNet) processed 100 billion transactions during 2014 with a total volume of US$6.8 trillion. (Source: Wikipedia)
- WORKDAY INC: Workday, Inc. is an American on‑demand (cloud-based) financial management and human capital management software vendor. Workday was founded by David Duffield, founder and former CEO of ERP company PeopleSoft, and former PeopleSoft chief strategist Aneel Bhusri following Oracle's hostile takeover of PeopleSoft in 2005. (Source: Wikipedia)
Performance
3-month Performance
6-month Performance
Source:Morningstar (my.morningstar.com)
1-year Performance
3-year Performance (only TA Global Technology Fund is more than 1-year old)
5-year Performance (only TA Global Technology Fund is more than 1-year old)
10-year Performance (only TA Global Technology Fund is more than 1-year old)
Personal Observations:
- It seems like Principal Global Technology Fund - MYR Hedged and United Global Technology - MYR performed better than Robotech RM Hedged and TA Global Technology Fund.
- Since only TA Global Technology Fund is open to retail investors (i.e. small investors), this is the only fund for us to tap into potential growth of global technology companies.
- TA Global Technology Fund can be invested through eUnitTrust platform or FAME platform.
- eUnitTrust platform (all transactions done online without agent's assistance, do your own homeworks) - Open eUnitTrust Account Here
- For account with servicing agent, choose either Non-Wrap Account Here or Wrap Account Here. (Find out the difference of accounts here)
- Principal Global Technology Fund - MYR Hedged, United Global Technology - MYR and Robotech RM Hedged must be invested using physical form (client must declared they are high networth individuals).
Additional Notes
- Article "Tech stocks valuations soar above five-year average — are they expensive?" (https://www.theedgemarkets.com/article/tech-stocks-valuations-soar-above-fiveyear-average-are-they-expensive) pointed out:
- The technology index is currently trading at 34.34 price-earnings (PE) multiple, which is above the five-year average of 25.7 times.
- The main fuel to the tech rally is mainly the expectation of the powerful deployment of new technologies in different gadgets and devices in our daily life. And that gives rise to anticipated exponential earnings growth. For the veteran investors, this might remind them of the dotcom boom.
- “I would advise investors to consider putting their bets on tech stocks that are still trading at reasonable valuations, so that it could be judged as laggards, for catch-up play,” he said
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