Investment Manager

CIMB Principal Asset Management Singapore

(January 2012)

How has the Fund performed recently compared to its peers and are there any particular stocks or areas where the Fund is performing well?

Since inception, the Fund has gained almost 43% (as of the end of October 2011), giving an annualised equivalent of 11% and outperforming its annualised targeted return of 10% per annum. This positive outperformance has been due to a more conservative asset allocation and our focus on solid bottom-up ideas that have remained resilient throughout this downturn. Our focus remains on blue chip large cap stocks with earnings visibility and long term sustainable business models.

The ASEAN region’s economies are heavily trade-dependent with the US and Europe in particular being key export markets. Has the region been especially affected by the economic slowdown in both those areas?

Yes, they have been affected as export growth has moderated in tandem with weaker US/European economies. Singapore and Malaysia are most exposed with Europe accounting for 8.1% and 9.6%, respectively, of exports and 12.8% and 8% of GDP respectively. Similarly, exports to the US from Singapore and Malaysia account for 6.4% and 9.5%, respectively, of total exports and 10.2% and 8% of GDP respectively.

The recent floods in Thailand are also expected to affect the Thai economy. Do you expect the effects to be severe and if so, what will this mean for investors?

The damage from the floods is expected to be severe, impacting the Thai economy for at least 3 months (Nov-Jan 2012). However, we believe this will be a one-off impact with a near term threat to 4Q2011 GDP before we see a sharp snap back in 1H2012. To alleviate a short term slowdown in domestic demand, the government will expand its fiscal outlay for reconstruction efforts and increased cash disbursements to affected households and small SMEs totalling about THB12bn.

The region has for some years now seen rapid urbanization and Jakarta is predicted to become the world’s largest city in less than two decades. Demographically, the region also has a relatively young population. What effect do these factors have on local economies and investment potential?

A relatively young population coupled with a growing economy translates to a growing middle class and a surge in consumer spending. Increasingly, the Indonesian economy is expected to be less dependent on exports of commodities and manufacturing and replaced by services. Besides the investment potential in infrastructure, key growth areas are expected to be the banking and consumer discretionary/staples sectors.

Is economic co-operation between countries within the region expected to grow further and how will that help investment?

Economic cooperation within ASEAN countries is expected to be enhanced further by more bilateral agreements. There will be more cross border investments. For example, more Singaporeans are investing in the Iskandar Region in Johor, Malaysia whilst selected Thai and Malaysian industrial companies are relocating to Indonesia to take advantage of cheaper labour costs for higher volume-based businesses.

Turning to the Fund itself, what advantages are there to investing in a wider region rather than just one specific country?

ASEAN as an asset class gives us exposure to a region with an estimated population of 500 million, USD2tn in GDP and USD1.8tn in market capitalization. From a portfolio perspective, it provides us with diversification not only across different countries but also across various sectors in the ASEAN region.

Are there any particular countries in the ASEAN region which consistently offer good investor opportunity and, if so, how does that affect your investment strategy?

The Indonesian structural story remains positive for the longer run as it is one of the highest growth ASEAN countries with upside potential when infrastructure spending is carried out in a meaningful way. The Jakarta Composite index (JCI) has risen 146% in the last 5 years versus the FTSE AC Asean index’s gain of 61%. However, we are neutral on Indonesia at the moment as it looks fairly valued at these levels and we find more compelling value in Thailand. Thailand’s investment case is based on an improving CAPEX cycle even before the floods hit the country. Most corporates have been under-investing in the last 5 years and we believe that this multi-year investment will continue once operations normalize by 1Q2012. On a bottom up basis, Thai stocks offer the second highest ROE at 20% in 2012, just behind Indonesia with 26%. At a PER of 9x FY12, we think there is a lot of value and upside.

How do you see the prospects for South-East Asia’s economies and markets over the coming months?

ASEAN economies’ growth projections should show a mild rebound in 1Q2012. For FY12, we expect most ASEAN economies to generate between 4-6.5% GDP, similar to figures for 2011. The downside for ASEAN stocks may be limited by hopes of more monetary easing as ASEAN central banks move from fighting inflation to a more pro-growth stance.

IMPORTANT NOTE: This report has been prepared for information only, and it does not represent an offer to purchase or subscribe to shares. World Investment Opportunities Funds (“WIOF”) is registered on the official list of collective investment undertakings pursuant to part I of the Luxembourg law of 20th December 2002 on collective investment undertakings as an open-ended investment company. WIOF believes that the information is correct at the date of production while obtained from carefully selected sources considered to be reliable. No warranty or representation is given to this effect and no liability can be assumed for the correctness or accuracy of the given information which may be subject to change at any time, without notice. Past performance provides neither a guarantee, nor an indication of future performance. Value of the shares and return they generate can fall as well as rise. Currency fluctuations, either up or down, may also affect value of the investment. Due to continuing market volatility and exchange rate fluctuations, the performance may be subject to significant changes over a short-term period. Investors should be aware that shares in the financial instruments entail investment risks, including the possible loss of the invested capital. Performance is usually calculated on the basis of the relevant NAV unless stated otherwise. Performance shown does not take account of any fees and costs associated with subscribing or redeeming shares. It is assumed that all dividends were reinvested. WIOF prospectus is available and may be obtained through www.1cornhill.com. Before investing in any WIOF Sub-fund(s) investors should contact their financial adviser / legal adviser / tax adviser and refer to all relevant documents relating to the WIOF and its particular Sub-fund(s), such as the latest annual report and prospectus that specify the particular risks associated with the Sub-fund, together with any specific restrictions applying, and the basis of dealing. In the event investors choose not to seek advice from a financial adviser / legal adviser / tax adviser, they should consider whether the WIOF is a suitable investment for them.