CAF
From China Stock Market
Contents |
Morgan Stanley China A-Share Fund
While FXI iShare FTSE/Xinhua China 25 Index is an index fund that invests in Chinese public companies that are traded on Hong Kong Stock Exchange, Morgan Stanley China A-Share is closed-end fund that is another choice for you to invest in China A-Share companies.
The Morgan Stanley's China A Share Fund is a $604 million fund launched in September 2006. It has seen the value of its holdings rise 89% this year, more than capturing the 59% gain in the benchmark Shanghai Composite Index since the beginning of the year -- even after a nearly 9% plunge in late February.
How To Invest: Morgan Stanley China A-Share Fund is traded under stock symbol CAF.
CAF Portfolio Composition
Updated as Decemeber, 31, 2008 from 2008 Annual Report. Looks major changes include reducing by 50% of their banking holdings, increasing some infrastructure plays, and increasing short-term investment to 13.8% of total. This seems to be smart, conservative measures.
| Classification | Percentage of Portfolio |
|---|---|
| Commercial Banks | 13.5% |
| Real Estate | 13.4% |
| Machinery | 9.3% |
| Construction Materials | 9.0% |
| Transportation | 6.9% |
| Beverages | 6.2% |
| Road & Rail | 5.3% |
| Oil, Gas & Consumable Fuels | 5.2% |
| Metals & Mining | 5.1% |
| Other* | 12.3% |
| Short-Term Investment | 13.8% |
CAF Top Holdings
The top holdings in CAF include a large percentage of commercial banks in China (25% of total portfolio). The second largest sector in CAF's holding is Oil, Gas and Consumable fuels (18%), followed by metals and mining (16%). Largest individual stocks in the CAF portfolio are:
Air China Ltd, China Construction Bank Corp, Industrial & Commercial Bank of China Ltd, China COSCO Holdings Co, Jiaozuo Wanfang Aluminum Manufacturing Co. Ltd, Shanxi Xishan Coal & Electricity Power Co. Ltd, Daqin Railway Co. Ltd, China Coal Energy Co. Wuhan Iron & Steel Co. Ltd. Guangxi Liugong Machinery Co. Ltd.
Key Development
Due to perceived downside risk in investing in China A share stocks, the Morgan Stanley's China A Share Fund is traded at a large discount to its underlying stock value. The discount is at about 20% when last checked in June, 2007.
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