BT launches Time technology fund in volatile global market

By Chris Hutching

Friday 19th May 2000

CRAIG STOBO: 'Global mix of technology securities offering greater diversity was an attraction to investors'

Volatility among listed technology stocks has boosted support for a new fund being promoted around the country by senior executives from BT Funds Management this week, chief investment officer Craig Stobo says.

The Time global share fund has attracted $A120 million from Australian investors since it was launched there in early March.

Mr Stobo said many investors had been attracted to the fund during the recent correction phase because of the greater diversity offered from the global mix of technology securities.

The fund invests in telecommunications, information technology and media enterprises rather than selected dotcom-type companies, of which there were only a handful, representing just 2% of the 180 companies in the fund, he said.

During the period of the Australian launch at the beginning of March until the end of April the Nasdaq had fallen 25% but the value of the fund had eased just 8%, demonstrating the benefits of stock research carried out by the fund managers, he said.

Although volatility would remain a feature of the fund it was expected to outperform in the longer term. Some analysts have pointed to 15-20% returns per annum in the longer term.

The fund is being measured against a new index set up by Morgan Stanley Capital International called the MSCI-BT Time Index, which measures the performance of technology stocks in main western countries rather than the US-focused Nasdaq.

They include internet and software developers, computer and electronic-equipment manufacturers, telecommunication services, biotechnology and pharmaceuticals.

Mr Stobo said the reason there were no New Zealand stocks and few Australian stocks in the fund was they simply did not have the "global reach" or management depth of the international stocks included in the fund. The stocks include US-based Cisco which was largely unaffected by recent volatility. Most of the stocks in the fund are based in Europe, the US and Japan.

A feature of the fund is a drip-feed savings plan where investors set up a direct debit from a New Zealand bank account into Time. BT Funds Management has been promoting the fund through financial intermediaries and marketing.

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