SCB Asset Management Company Limited (SCBAM) stated that due to the announcement of the U.S.’ reciprocal tariffs, the stock market around the world is currently facing volatility higher than the market anticipated. Thailand also faces a 37% tariff rate, which is now in the U.S. President Donald Trump’s 90 day pause period.
The stock market is seemingly recovering from its sharp decline. However, SCBAM views that whether the sustainable rise of the stock market will happen depends on the negotiation with the U.S., which would take one to three months before definite trade policy can be formed. Another support factor may be the U.S. federal reserve’s monetary policy. Meanwhile, an interest rate cut could ease concerns over the tariff’s impact on the U.S. economy.
The uncertainty of trade policy still creates volatility in the stock market, both positively and negatively. Therefore, the current strategy is to rebalance the portfolio and decrease its uncertainty. SCBAM advises investing in the fund that applies a flexible strategy and can open Long/Short positions to generate returns amid volatility.
The company recommended SCB Absolute Return Fund due its focus on investing in Thai stock. Its goal is to generate positive returns, whether amid a bull or bear market, by using SET50 Future to mitigate risk from market’s volatility. The fund also manages itself in absolute return style by utilizing stock selection’s capability to generate profit.
As for the fund’s portfolio, there are five stocks that receive the fund’s highest investment. They are as follow:
- Charoen Pokphand Foods Public Company Limited (SET: CPF) with 6.5% of NAV.
- SCB X Public Company Limited (SET: SCB) with 6.03% of NAV.
- Bangkok Bank Public Company Limited (SET: BBL) with 5.57% of NAV.
- Kasikornbank Public Company Limited (SET: KBANK) with 5.57% of NAV
- Delta Electronics (Thailand) Public Company Limited (SET: DELTA) with 5.48% of NAV.
