OSK-UOB Unit Trust Management has launched its latest fund linked to Berkshire Hathaway Class B shares and the S&P500. The firm's previous product, the OSK-UOB Capital Protected Sector Strategy Fund, was launched in March and sold around MYR22m ($7.25m).
The US Legendary Fund has a tenor of 18 months, shorter than previous products launched by OSK-UOB and, unlike the majority of its previous close-ended funds, does not guarantee 100% of capital at maturity.
Instead, 102.25% of initial capital will be returned provided the closing price of the underlying share is at or above 80% of its initial level or if Berkshire Hathaway, the investment vehicle of renowned investor Warren Buffett, has closed at or above 125% of its initial level at any time. Otherwise, initial capital will be reduced in line with the fall in the share.
There is also a conditional payment at maturity equal to the outperformance of Buffett's firm against the US index, subject to a minimum of 4%. If at maturity the index is below its initial level, the coupon will equal the performance of the share, also subject to a minimum 4%.
"Berkshire Hathaway stocks currently hover around US$75 per share and we are confident it will increase further over the next 18-month period," said OSK-UOB CEO Ho Seng Yee.
The fund will be distributed by Alliance Bank (Malaysia) with a minimum investment of MYR250,000 ($83,000). The offer closes on 8 July.
This product appears in Recent Additions (Malaysia).