mena region - cimb- · pdf filecover story. there will be a ... letter to investors ... of oil...

MAR08

MENA REGIONRiding the wave of the new oil boom in light of global market conditions

Dear Valued Investors,It’s the time of the year again when we create fresh beginnings with new goals

to reach out. It is also an important starting point for all our investors to take

this time to review where you financially stand and discover ways to grow your

wealth with us in 2008.

To mark a new beginning for the year, we have simplified investors’ investment choice by introducing the 8 Flagship Funds which makes it easier for investors to identify the core funds to build their long term investment portfolio. These funds are identified as funds with sustainable growth performance as 7 out of the 8 funds are in the first Quartile*** and have exceeded their peers’ performance consistently.

Allow me to share with you that we have ended the year 2007 with an AUM of 19.6 billion exceeding 27% growth from our targeted amount. We have also emerged as a winner for the

• Best Mixed Assets Group Award (3 years) by The Edge – Lipper Malaysia Fund Awards (2008)

• Best of Best Country Awards: Islamic Fund House of The Year (Malaysia) – CIMB Islamic Group Asset Management by Asia Asset Management Awards 2008

• Best of Best Country Awards: CEO of The Year (Malaysia) – CIMB-Principal Asset Management - Datuk Noripah Kamso by Asia Asset Management Awards 2008

These awards are symbolic of the Company’s achievements which were made possible by the faith of our investors. And to reward our investors for their continuing support, we have consistently ensured we deliver only the best and these awards are testaments of our ongoing efforts for the benefit of investors.

Our dynamic investment team consisting of 33 professionals continues to create value for our investors with an impressive improved performance growth of 43.28%* for equity funds and has outperformed KLCI by 11.46%**. As at 31st December 2007, a full 82% of CIMB-Principal’s peer comparable funds were ranked in either 1st or 2nd Quartile for the last one year period**.

In an effort to offer a streamlined yet comprehensive product offering, and to achieve greater efficiency in the management of all our 70 unit trust funds, we have already started looking into merging some of our existing funds with the similar objectives to enhance investment returns for our investors. This exercise was decided as there were duplicates of funds with similar investment objectives in our stable after the acquisition and integration of SBB Asset Management Sdn Bhd and SBB Mutual Bhd (now CIMB Wealth Advisors Berhad). This also allows us to extend our range of investment products aimed to meet investors’ growing appetite.

Effective 3 January 2008, we have implemented a new name convention across all our funds by adopting a standardized methodology for ease of identification for all our distribution partners and investors. All of our conventional funds now carry

the prefix ‘CIMB-Principal’, while its Islamic funds now carry the prefix ‘CIMB Islamic’. Previously, some of these funds either carried the prefix ‘SBB’ or did not have prefixes. This new naming convention also applies to funds of CIMB Wealth Advisors, to ensure consistency and allows local and regional investors to recognize our brand and investment products immediately. It also creates a distinct brand for our Shariah-compliant funds which is in line with our international aspirations to capture the Islamic space.

To further realize this aspiration, we have created a physical presence in Bahrain and Brunei to expand our Islamic offerings to international investors. As the Indonesian market continues to be upbeat, we aim to stay ahead of the pack by being number one in the Indonesian Shariah AUM League Table. Meanwhile, the Singapore office will act as a regional hub to meet international investors’ needs for ASEAN growth funds and Islamic funds.

Our goal for 2008 is to be among the first asset management companies in Malaysia that will be GIPS compliant, which is an international certificate for asset managers that meet global standards in its operation and processes. This innovative goal is in sync with our commitment to deliver the best to our investors, not only offering relevant funds that meet investors’ needs but also through globally recognized asset management standards.

We have recently launched the CIMB-Principal MENA Equity Fund, a new equity fund that provides investors direct access to the oil-rich region’s prosperity to diversify and potentially enhance their investment portfolios. Learn more about this region in our Cover Story. There will be a total of 20 new funds for local and offshore investors in the pipeline this year, of which they can be easily sourced from the agents of CIMB Wealth Advisors, Personal Financial Advisors (PFAs) of CIMB Bank, Bank Niaga and other bank distributors. For further details of these new innovative products, you will have to stay tuned to find out!

Happy Investing!

Noripah KamsoChief ExecutiveCIMB-Principal Asset Management Berhad

Letter to Investors

* Source: Institutional Composite Performance ** Source: Lipper as at 31/12/07 *** Source: Lipper Hindsight on a Rolling 1 Year Basis

Middle East and North Africa (MENA) Region

With the current market volatility and interests in popular developing markets waning, I’m

sure you are eager to know how you could benefit despite these current market conditions. Imagine the potential to diversify your portfolio with a region that is lowly correlated to developed markets and is less exposed to the current volatility hitting markets around the world.

With our recent introduction of CIMB-Principal MENA Equity Fund into the investments scene, some of you may be asking yourselves, do you really need to look into such areas when you could just be as happy diversifying your investments amongst the current offerings which are already in the market?

The low correlation of the Middle Eastern markets to global markets would definitely be a factor to consider for diversification in your investment portfolio. Recent years have seen major changes to the structure of MENA economies and the

role of financial markets. In the wake of ample opportunity and potential investments, the MENA region is set to offer a robust and dynamic GDP growth, as it has the potential to be a vital source for global economic stability.

These hidden investment treasure in the MENA (Middle East and North Africa) region includes Gulf Cooperation Countries (GCC) such as Tunisia, Algeria, and the oil-rich Middle Eastern countries of Saudi Arabia, Jordan and Kuwait. The potential for good investment gains exists, especially in the light of the fact that Middle East has huge reserves of oil, providing the backdrop of further growth, and also produces one third of the global oil supply, representing over 60% of reserves.

Besides being lowly correlated with the world markets, this next investment hotspot now appeals to investors who are hungry for an untapped and undervalued market. This region was previously shunned for its conflicts and insecurity due

Cover Story

Raymond TangChief Investment Officer

[email protected]

Riding the wave of the new oil boom in light of global market conditions

Cover Story

to common misperception. The undervalued MENA region is not only appealing with d ivers i f icat ion benefits due to it’s low correlation to the World Market, it is also investing in safe haven countries like Oman, Bahrain, UAE and Qatar

with a country risk rating of A and BBB* as compared to Malaysia’s own rating of BBB (Bloomberg as at Dec 07, from the Economist Intelligence Unit).

The amount of inflows of investments into the Middle East, particularly the GCC economies has been astounding in recent times. However, the Middle East and Africa region is not only just about oil and commodities. The financial hubs in the Middle Eastern countries have been growing at a healthy speed and Africa’s domestic growth has been strong. The rise of the petrodollars has also spilled over to various sectors that include real estates, banks, industrials, financial services and others.

If you are looking for investments with long-term sustainability, MENA is much sought after due to the rising oil price, creating ample liquidity in the region and fuelling economic growth. With the

global oil demand outpacing supply, oil prices have been rising dramatically and driving massive petrodollar revenue and liquidity in oil producing regions. Backed by domestic demand, current account surpluses and increased foreign direct investments, the region enjoys an economic growth of 5% a year over the last 3 years (World Bank, “MENA 2007 Economic Developments and Prospects”). This flush of petrodollars has resulted in massive government expenditure to build a strong industrial base in the region, reaching US$1.5 trillion for the next 5 years (HSBC Global Research, Meed, Thomson Financial Datastream, as of August 2007. For GCC countries only).

With the general upbeat outlook for continuous high oil prices, this region will keep up to its pace to improve its private sector business and maintain its flourishing growth story. The MENA

region is definitely set to generate an attractive appetite for global investors who are keen to tap on the economic growth driven by oil revenues, given the promising economic outlook for 2008. With improving market access it has to offer, you will find attractive investment opportunities in this region through the recently launched CIMB-Principal MENA Equity Fund despite the current global market conditions.

If you are looking for investments with long-term sustainability,

MENA is much sought after due to the rising oil price, creating

ample liquidity in the region and fuelling economic growth.

Share Market

Malaysian GDP growth forecast of 6.3% for 2008 will be sustained by domestic consumption and implementation of projects under the 9th Malaysia Plan.

Following upgrades of the Plantation Sector, earnings growth for 2008 has hit 16.5% with PER at 13.5x. Further, Bursa Malaysia earnings are defensive. Plantation Sector earnings are driven by CPO prices while that of Oil & Gas are driven by expenditure by Petronas. Higher oil and CPO prices will provide continued interest in plantations and oil related stocks.

As such, our portfolios continue to overweight Plantation, Oil & Gas and Building Material Sectors.

Global Equity Markets

Global equity markets are getting increasingly concerned over a possible recession in the US following the release of lower than expected job creation numbers in November and increase in the unemployment rate from 4.7% to 5.0%.

Earnings in Asia may have de-coupled to some extent from the US but exports will still be affected by the US slowdown. Therefore, domestic investment themes dominate throughout Asia.

Regional portfolios will keep to these themes while riding out the continued volatility in regional markets.

Fixed Income

The Malaysian sovereign bond market was in a brief correction mode triggered by a heavy sell down of the 20-year MGS in the 4th quarter.

In the absence of offshore players and US dollar weakness, the strengthened Ringgit did not help revive the bearish outlook in the sovereign bonds in the fourth quarter. Investors preferred to stay sidelined due to higher inflation expectations in 2008.

Aside from the year end window dressing activities, the local corporate bond market was generally cautiously traded in the 4th quarter.

Market Overview

Dec Qtr Year to end % Dec %

Malaysia KLCI 8.3 32.0

Singapore STI -7.0 15.4

Indonesia JCI 16.4 52.1

Japan Nikkei -8.8 -11.1

Hong Kong Hang Seng 0.8 37.1

United States S&P 500 -3.2 4.2% KLCI ST Nikkei S&P500

Share Market Price Indices Share Market Indices

Sou

rce:

Blo

ombe

rg

Dec 06 Mar 07 Jun 07 Sep 07 Dec 07

140

130

120

110

100

90

80

140

130

120

110

100

90

80

Fund Performance

Performance up to 31 December 2007 (%)

Note: CIMB-Principal Greater China Equity Fund, CIMB-Principal ASEAN Equity Fund and CIMB-Principal Climate Change Equity Fund, CIMB Islamic Global Equity Fund, CIMB-Principal MENA Equity Fund, CIMB Islamic DALI Equity Theme Fund and CIMB Islamic Money Market Fund were launched on 12 June 07, 12 September 07, 27 September 07, 8 January 2008, 5 February 2008, 18 February 2008 and 17 March 2008 respectively.

Fund Performance Summary

Benchmark Main InvestmentsFund Size

(RM mil)1 Month (%) 3 Months (%) 6 Months (%) 12 Months (%) 3 Years (%)

Since

Inception (%)

CIMB-Principal Bond Fund (formerly Lifetime Bond Fund)

Fixed Income Securities 212.95 0.56 0.46 0.96 3.59 13 109.4

Ram Quant shop MGS Bond Index (Medium sub-index) 0.15 0.22 0.2 3.57 11.87 75.47

CIMB-Principal Strategic Bond Fund(formerly Strategic Bond Fund)

Fixed income Securities 78.21 -0.01 0.45 0.68 4.01 29.46 39.95


CIMB-Principal Global Titans Fund (formerly Global Titans Fund)

Shares 84.13 -1.53 -3.62 -2.64 1.67 18.38

35% S&P 500 + 30% MSCI Europe + 10% MSCI Japan + 25% CIMB Bank 1-month Fixed Deposit Rate -2.42 -3.89 -3.83 0.51 15.17

CIMB-Principal Emerging Asia Fund (formerly Emerging Asia Fund)

Shares 67.18 -1.74 -1.10 6.47 33.52 58.92

FTSE All-World Asia Pacific ex Japan, Australia and New Zealand -1.57 -0.89 15.03 38.54 84.91

CIMB Islamic Asia Pacific Equity Fund (formerly Asia Pacific Adil Fund)

Shares 71.08 -3.92 -7.66 2.85 16.04 25.05

The Dow Jones Islamic Market Asia/Pacific Index -4.01 -7.37 -1.75 5.94 8.63

CIMB-Principal Balanced Fund (formerly Balanced Returns Fund)

Diversified 97.93 3.86 5.74 5.3 34.93 53.44 275.56

70% KLCI + 30% CIMB Bank 1-Month Fixed Deposit Rate 2.49 5.92 5.27 24.11 52.68 140.21

CIMB-Principal Equity Aggressive Fund 3 (formerly Future Goals Fund)

Shares 147.79 6.70 10.05 10.46 42.64 62.45 238.72

KLCI 3.44 8.14 6.69 33.87 74.81 170.79

CIMB-Principal Income Plus Balanced Fund (formerly Income Plus Fund)

Diversified 111.57 2.15 3.73 4.69 15.01 28.27 149.44

40% KLCI + 60% CIMB Bank 1-Month Fixed Deposit Rateh 1.53 3.72 3.75 14.81 32.82 100.49

CIMB-Principal Xcess Cash Fund (formerly Xcess Cash Fund)

Money Market Instrument 199.73 0.27 0.78 1.54 3.02 8.84 10.45

The CIMB Bank overnight rate 0.21 0.63 1.26 2.43 6.9 8.82

CIMB-Principal Small Cap Fund (formerly Hidden Treasures Fund)

Shares 14.22 4.26 4.6 13.82 53.33 56.05 69.28

FTSE Bursa Malaysia Small Cap Index 3.97 7.39 9.93 63.72 95.29 100.53

CIMB Islamic Enhanced Sukuk Fund (formerly Lifetime Dana Wafiq)

Diversified 16.97 1.74 2.56 2.74 9.86 21.63

85% CIMB Bank 1-Month General Investment Account (GIA) + 15% FTSE Bursa Malaysia Emas Shariah Index

0.93 2.37 3.17 8.55 16.39

CIMB Islamic Equity Aggressive Fund (formerly Lifetime Dana Mubarak)

Shares 55.09 5.41 11.29 12.26 50.43 54.14 29.31

FTSE Bursa Malaysia Emas Shariah Index 4.93 11.99 12.78 46.94 84.89 n/a

CIMB Islamic Balanced Growth Fund (formerly Lifetime Dana Barakah)

Diversified 21.27 3.32 6.4 7.41 32.81 41.64 69.16

60% FBM Emas Shariah Index+ 40% CIMB Islamic 1-Month General Investment Account (GIA) 3.05 7.40 8.31 27.93 50.27 86.80

CIMB Islamic Short Term Sukuk Fund(formerly Lifetime Dana Fayyad)

Diversified 386.88 0.26 0.62 1.19 2.95 5.77

CIMB Islamic 1-month General Investment Account-I (GIA) 0.23 0.72 1.43 2.97 5.14

CIMB-Principal Xcess Income Fund (formerly Xcess Income Fund)

Money Market Instrument 91.94 0.25 0.75 1.4 2.94 6.9

The CIMB Bank 1-month Fixed Deposit Rate 0.26 0.79 1.59 3.14 5.38

CIMB-Principal Global Asset Spectra Fund(formerly Global Asset Spectra Fund)

Diversified 74.26 -1.53 -2.02 -0.54 1.02 1.19

25%MSCI WORLD Index+ 25% JP Morgan Global Govt Bond+ 25% S&P/Citigroup BMI Property Index + 25% S&P Commodity Index G-TR

-2.02 -3.23 -0.61 0.71 0.14

Fund Performance

Fund Performance Summary

Benchmark Main InvestmentsFund Size

(RM mil)1 Month (%) 3 Months (%) 6 Months (%) 12 Months (%) 3 Years (%)

Since

Inception (%)


Fixed Income Securities 212.95 0.56 0.46 0.96 3.59 13 109.4


CIMB-Principal Strategic Bond Fund(formerly Strategic Bond Fund)

Fixed income Securities 78.21 -0.01 0.45 0.68 4.01 29.46 39.95



Shares 84.13 -1.53 -3.62 -2.64 1.67 18.38

35% S&P 500 + 30% MSCI Europe + 10% MSCI Japan + 25% CIMB Bank 1-month Fixed Deposit Rate -2.42 -3.89 -3.83 0.51 15.17


Shares 67.18 -1.74 -1.10 6.47 33.52 58.92

FTSE All-World Asia Pacific ex Japan, Australia and New Zealand -1.57 -0.89 15.03 38.54 84.91


Shares 71.08 -3.92 -7.66 2.85 16.04 25.05

The Dow Jones Islamic Market Asia/Pacific Index -4.01 -7.37 -1.75 5.94 8.63


Diversified 97.93 3.86 5.74 5.3 34.93 53.44 275.56

70% KLCI + 30% CIMB Bank 1-Month Fixed Deposit Rate 2.49 5.92 5.27 24.11 52.68 140.21


Shares 147.79 6.70 10.05 10.46 42.64 62.45 238.72

KLCI 3.44 8.14 6.69 33.87 74.81 170.79


Diversified 111.57 2.15 3.73 4.69 15.01 28.27 149.44

40% KLCI + 60% CIMB Bank 1-Month Fixed Deposit Rateh 1.53 3.72 3.75 14.81 32.82 100.49


Money Market Instrument 199.73 0.27 0.78 1.54 3.02 8.84 10.45

The CIMB Bank overnight rate 0.21 0.63 1.26 2.43 6.9 8.82


Shares 14.22 4.26 4.6 13.82 53.33 56.05 69.28

FTSE Bursa Malaysia Small Cap Index 3.97 7.39 9.93 63.72 95.29 100.53


Diversified 16.97 1.74 2.56 2.74 9.86 21.63

85% CIMB Bank 1-Month General Investment Account (GIA) + 15% FTSE Bursa Malaysia Emas Shariah Index

0.93 2.37 3.17 8.55 16.39


Shares 55.09 5.41 11.29 12.26 50.43 54.14 29.31

FTSE Bursa Malaysia Emas Shariah Index 4.93 11.99 12.78 46.94 84.89 n/a


Diversified 21.27 3.32 6.4 7.41 32.81 41.64 69.16

60% FBM Emas Shariah Index+ 40% CIMB Islamic 1-Month General Investment Account (GIA) 3.05 7.40 8.31 27.93 50.27 86.80

CIMB Islamic Short Term Sukuk Fund(formerly Lifetime Dana Fayyad)

Diversified 386.88 0.26 0.62 1.19 2.95 5.77

CIMB Islamic 1-month General Investment Account-I (GIA) 0.23 0.72 1.43 2.97 5.14


Money Market Instrument 91.94 0.25 0.75 1.4 2.94 6.9

The CIMB Bank 1-month Fixed Deposit Rate 0.26 0.79 1.59 3.14 5.38

CIMB-Principal Global Asset Spectra Fund(formerly Global Asset Spectra Fund)

Diversified 74.26 -1.53 -2.02 -0.54 1.02 1.19

25%MSCI WORLD Index+ 25% JP Morgan Global Govt Bond+ 25% S&P/Citigroup BMI Property Index + 25% S&P Commodity Index G-TR

-2.02 -3.23 -0.61 0.71 0.14

Please note that Clause 2.16 of the Securities Commission Guidelines on Unit Trust Advertisements and Promotional Materials prevents us from disclosing performance figures for periods of less than one year unless accompanied by the most recent figure for one year’s duration.

• CIMB-Principal Bond Fund generated return of 0.56% for the month and 0.48% for 4Q07. The Fund outperformed its benchmark of RAM Quant shop All Index by 71 bps and (Medium) Index by 26 bps.

• The bond market is expected to be neutral if not slightly soft in the 1Q08 as high inflationary expectation will dampen sentiment. However, we expect BNM to maintain its OPR during the 1H.

• In view of the above, we expect to position the Fund at short to neutral benchmark duration.


• The Fund registered a negative return of 0.01% for the month of December, underperformed the benchmark by 0.14% whilst the bond portion managed to register a positive return of 0.28%, which outperformed the benchmark by 0.13%.

• For the quarter performance, the Fund returned 0.45% versus the benchmark of 0.22% while the bond portfolio did slightly better with 0.86% return during the quarter, which outperformed the benchmark by 0.64%.


• In view of the above, we expect to position the Fund at short to neutral benchmark duration.

CIMB-Principal Strategic Bond Fund (formerly Strategic Bond Fund)

• CIMB-Principal Global Titans Fund lost 3.62% for the quarter to Dec 07, outperforming the benchmark by 0.26%, mainly attributable to favourable stock selection in US. Year to Dec 07, the Fund returned 1.67%, outperforming the benchmark by 1.16%.

• During the quarter, MYR strengthened against USD by 2.9%, contributing negatively to the Fund’s performance.

• The Fund is currently tactically Overweight on Europe, Neutral on US and Underweight on Japan according to the asset allocation model. The US market is expected to be plagued by news of mortgage resets, credit related issues and provisions to be made by investment banks. European equity is still attractive relative to other developed markets’ PE of less than 13.5 times with yield of 3.3%. Downward pressure in Japan’s stock markets is expected to remain with growing likelihood of a mild US recession and after the Bank of Japan downgraded its economic assessment for the first time in 3 years.


• The Fund was down 1.74% against the benchmark’s fall of 1.57% in December. The main reason for the underperformance was the weak performance of stocks in India and Malaysia.

• Asian markets stabilized in December, after the sharp sell in November. Rising inflation was the core theme for the region. In China, inflation reached a new high of 6.9% with the central bank moving further to tighten reserve requirements to 14.5%. Korea has a new president who is market friendly and pro-growth.

• The portfolio is under-weighted in China and overweight Korea, Indonesia and Malaysia. We will look for companies with improving business, sustainable fundamentals and attractive relative valuations.


Bonds 93.48%

Commercial Papers 1.42%

Liquid Assets & Others 5.10%

Top 5 holdings1 Special Power Vehicle2 K'tium L.Raya Utara Timur3 Bank Muamalat (M) Bhd4 Eon Capital Berhad5 Encorp Systembilt Sdn Bhd

Fixed Income Securities 91.60%

Unit Trust 0.49% Warrants/Option 2.27%

Top 5 holdings1 DRB Hicom Bhd2 K’tium L.Raya Utara Timur3 Malakoff Corp Berhad4 SPLASH IMTN5 Sykt Bekalan Air S'ngor


Bonds 50.30%

US1 Exxon Mobil Corp2 Microsoft Corp

Europe1 Vodafone Group Plc2 Nokia Oyj

Japan1 Toyota Motor Corp2 Nintendo Co Ltd


Liquid Assets & Others 100%

Top 5 holdings1 BOC Hong Kong

(Holdings) Limited2 Hang Seng Bank Limited3 China Mobile Limited4 China Construction Bank Corporation5 Bank Of India

Fund Performance

• CIMB-Principal Global Asset Spectra Fund outperformed the benchmark by 0.5% despite losing 1.5% in the month of December. This was attributable to our underweight position in Property as well as favourable stock selection within the sector.

• Volatility in equities persists with concerns surrounding the US problems coupled with a mix of data. Fixed income continues to experience volatility with inflationary pressures. The sentiment on property remains predominantly negative, while commodities remain the star performer as most commodities hit all time highs.

• Our asset allocation targets are revised - 20% in Equity, 30% in Fixed Income from 40%, 10% in Property and 40% Commodity from 30%.

CIMB-Principal Global Asset Spectra Fund (formerly Global Asset Spectra Fund)

• The Fund’s NAV increased by 6.7% (KLCI:3.4%) in Dec 07. Outperformance for the month was due to overweights in UMW, KNM and Rexit. For 2007, the Fund was up 42.6%, outperforming the KLCI by 8.9% (KLCI:33.7%) from overweighting the Plantation, Oil & Gas and Construction Sectors.

• The Malaysian market continues to look defensive in the current uncertain global environment. External factors will cause market volatility in the short-term but in the longer term, earnings will prevail. We expect the market to be re-rated in the next 2-3 months from the earnings season, as we believe current IBES EPS growth expectations are understated for 2008 at 8%.

• As we look forward to 2008, earnings growth is projected at 16% with market PER at 13.5x. Given the slowdown of the US economy, the Fund will overweight sectors with defensive earnings streams, which include the Oil & Gas and Plantation Sectors.

• Equity allocation has been maintained at 90%. The Fund continues to be overweighted in Plantations (19.3%), Oil & Gas (9.4%) and Property (6.2%)


• In line with the decline of regional and global stockmarkets, the Fund’s NAV declined by 3.9% in December in line with the benchmark’s fall of 3.78%.

• Global markets retreated in December due to rekindled concerns that the US economy will fall into a recession due to the rise of funding pressure in the money markets and the deepening problems in the US housing market.

• We remain bullish on the long-term prospects for Asian equities as the case for growth is intact. The Fund is overweight Asia ex-Japan, and country wise it is overweight China/Hong Kong, Malaysia, Indonesia, Malaysia, Singapore and Thailand.


• CIMB-Principal Balanced Fund outperformed the index by 1.4% in December and 11.5% YTD. The Fund recorded gains of 3.9% for the month and 35.7% for the year. Despite the market volatility throughout the year, the Fund’s fully invested strategy was beneficial for its performance.

• Malaysia’s market continues to be defensive in the current uncertain global environment, although global liquidity is still ample. While external factors will drive markets in the short term, longer term GDP expectations are relatively intact. The market should re-rate in the next 2-3 months from the earnings season, as current IBES EPS growth expectations are understated for 2008 at 8%.

• Given these abovementioned factors, we will maintain our overweight position in equities. Focus in growth sectors such as Oil & Gas, Plantation and Property is also maintained.


PGI Funds 79.58%


Top 5 holdings1 BHP Billiton Limited2 China Mobile Limited3 PetroChina Company

Limited4 Komatsu Ltd5 Samsung Electronics Co. Limited

Fixed Income Fund 40.57%


Top 5 holdings1 Schroder ALT SOL-CMDTY-A2 Principal GLB-EUR EQ-INS ACC3 Principal GLB-Preferred Securities Fund4 Schroder ISF-USD BOND-CAC5 Franklin Global Real Estate

USD Fund

Equities Fund 11.14%

Properties Fund 10.54%

Commodities Fund 33.15%

Malaysian Shares 93.54%


Top 5 holdings1 Sime Darby Berhad2 IOI Corporation Berhad 3 Rexit Berhad4 Bumiputra-Commerce

Holdings Berhad 5 Public Bank Berhad (Local)




Top 5 holdings1 Sime Darby Berhad2 K'tium L.Raya Utara Timur3 Bumiputra-Commerce

Holdings Berhad4 IOI Corporation Berhad5 Jimah Energy Ventures SB

Fund Performance

Fund Performance

• In Nov 07, the Fund grew by 2.15%, outperforming its composite benchmark by 0.62%. On a YTD basis, the Fund gained 14.98% for an outperformance of 0.03%. The outperformance was due to the strong performance of the Plantation and Oil & Gas stocks.

• The low beta Malaysian market is a beacon in the current uncertainties and to global liquidity. Expectations are for an upward re-rating once investors realise that domestic earnings’ growth has been underestimated.

• Focus going forward will be on the abovementioned sectors as well as on large cap names with the best fundamentals and liquidity.





Top 5 holdings1 Special Power Vehicle2 K'tium L.Raya Utara Timur3 Cepat Assets Berhad 4 DRB Hicom Bhd5 Encorp Systembilt

Sdn Bhd

• The Fund gained 4.8% in Sept, but underperformed the FBM Shariah Emas by 0.9%. The gains reflect the recovery of most of the stocks which suffered most in August.

• The 50bp Fed cut has averted a global credit crunch. This had led to a resumption of the yen carry trade, cheaper credit and shift away from holding of USD assets. A liquidity run in Asia is likely and Malaysia should benefit with its relatively undervalued currency. The KLCI should rise on pure liquidity flows, but underperform regional markets given the lower 2008 earnings growth.

• The Fund’s strategy is to maintain its high asset allocation as long-term prospects for Malaysian stocks remains positive. Stock selection continues to focus on mid-to-large cap stocks with some small cap exposure. The Fund remains overweight in Construction, Infrastructure, Properties and Oil & Gas.




Top 5 holdings1 Sime Darby Berhad2 IOI Corporation Berhad3 Tenaga Nasional Berhad4 Telekom Malaysia Berhad5 Kuala Lumpur Kepong

Berhad

• CIMB Islamic Balanced Growth Fund outperformed the index by 0.3% MTD and 4.8% YTD. The Fund posted healthy gains of 3.3% for the month and 33.3% for 2007. Its overweight position in equities benefited from December’s market uptrend while keeping fully invested throughout 2007 also proved to be beneficial despite the market volatility.

• Malaysia’s market continues to be defensive in the current uncertain global environment, although global liquidity is still ample. While external factors will drive markets in the short term, longer term GDP expectations are relatively intact. The market should re-rate in the next 2-3 months from the earnings season, as current IBES EPS growth expectations are understated for 2008 at 8%.

• We will therefore maintain our overweight position in equities. We will also continue to focus in Oil & Gas, Plantation and Property.




Islamic Fixed Income Securities32.04%

Top 5 holdings1 Teknologi Tenaga Perlis2 K’tium L.Raya Utara Timur3 Sime Darby Berhad4 Guthrie Prop.Dev.Hldgs Bhd5 Puncak Niaga (M) Sdn Bhd

• The Fund’s performance for the month of December was 0.27%, outperforming the benchmark overnight rate by 0.06%. For the quarter (4Q07), the Fund generated a return of 0.78% against the benchmark of 0.63%. The better performance is due to the Fund’s exposure to short dated corporate bonds.


• We will continue to maximize the exposure in less than 1-year to maturity securities while maintaining exposure in securities maturing between 1 and 2 years.


Bonds 49.54%

Liquid Assets & Others 24.28%Commercial

Paper26.18%

Top 5 holdings1 AmBank (M) Berhad2 M'sian Indus Dev Fin (BG)3 YTL Power Int. Berhad4 YTL Power Int. Berhad5 Sabah Development Bank

• CIMB-Principal Small Cap Fund gained 4.26% in Dec, out-performing its benchmark by 29bps, due to the fund’s overweight in the plantation sector. For 2007, the Fund was up 53.3% compared with the benchmark’s rise of 63.7%. The under-performance was due to its limit to stocks with a market cap of below RM750m.

• In the near term, we expect the Malaysian market to be affected by the uncertain global environment. However, we expect a re-rating in the next 2 – 3 months from stronger than expected corporate earnings, as we believe current IBES EPS growth forecasts are understated for 2008 at 8%.

• With the change in benchmark to FBMSC index effective 3 Jan 08, we will be looking at adding new index component stocks into the fund.


• The Fund recorded a return of 1.74% in December and 2.56% for the 4th quarter. The bond portion of the Fund outperformed the RAM Quant Shop All Index and Medium Index by 0.36% and 0.26% respectively for the month.


• In view of the above, we expect to position the fund at short to neutral benchmark duration bonds.


• The Fund depreciated by 2.4% in December outperforming the Golden Dragon Index by 1.41%. On YTD basis, the Fund is up 11.0%; for underperformance of 1.0%.

• Even as the US economy slows down in 2008, EPS growth in Asia ex-Japan should remain positive and underpin market valuations. Asian ex-Japan earnings have de-coupled to some extent from US GDP growth. Further, as the US Dollar weakens from more Fed cuts, Asia is a beneficiary of fund flows.

• The Fund is invested in China (50.6%); Hong Kong (27.7%) and Taiwan (15.3%). Its largest holdings are in China Mobile (9.8%) and CNOOC (4.10%).

CIMB-Principal Greater China Equity Fund

• The performance of the Fund for the month of December was 0.25%, which slightly underperformed the benchmark 1 month Fixed Deposit by 0.01%. For the quarter (4Q07), the Fund returned 0.75% against the benchmark of 0.79%.


• We will maintain current exposure in short to medium term securities and ride on the volatile market.




Top 5 holdings1 Hiap Teck Venture Berhad 2 Leader Universal Holdings

Berhad 3 Ahmad Zaki Resources

Berhad4 Coastal Contracts5 Malaysia Steel Works KL Berhad




Top 5 holdings1 Jimah Energy Ventures SB2 DRB Hicom Bhd3 Ktium L.Raya B'worth-Kulim4 Sykt Bekalan Air S'ngor5 Expressway Lingkaran

Tengah


Commercial Paper 37.84%

Bonds 40.65%

Top 5 holdings1 YTL Power Int. Berhad2 Malakoff Corp Berhad3 AmBank (M) Berhad4 M'sian Indus Dev Fin5 Celcom (Malaysia) Berhad

Liquid Assets & others2.90%

Top 5 holdings1 China Mobile2 PetroChina3 China Life Insurance ‘h’cny14 TSMC5 CNOOC

Schroder ISF Greater China 97.10%

• The performance of the Fund for the month of December was 0.26%, outperforming the 1 month GIA benchmark by 0.03%. For the quarter (4Q07), the Fund returned 0.62% versus the benchmark of 0.72%.


• We will invest in short to medium term securities with selective participation in primary issues.

CIMB Islamic Short Term Sukuk Fund (formerly Lifetime Dana Fayyad)


Commercial Paper 24.35%

Top 5 holdings1 Cagamas Bhd2 KESAS Sdn Bhd3 Kapar Energy Ventures SB 4 Sime Darby5 AmIslamic Bank Berhad

Bonds 65.56%

Fund Performance

Does Investing the Shariah-Compliant Way Limit Long-term Investment Potential Returns?The constraints in participating within certain industries like the conventional banking and entertainment industries has resulted in a mistaken perception that Shariah-compliant funds are substandard in performance as compared to their conventional counterparts. The relative newness of Islamic or Shariah-compliant investing as compared to conventional investing is mainly due to the lack of sufficient exposure and information on the benefits and results that comes with investing in accordance to the Shariah principles.

Sufficient Diversification The variation in returns for Shariah-compliant funds, whether equity or fixed income (sukuk), compared to their conventional counterparts is not dissimilar because Shariah-compliant fund portfolios are as diversified as their conventional fund portfolio counterparts.

In 1970, Lawrence Fisher and James H. Lorie found that the majority (95%) of diversification benefits accrue when a portfolio holds 32 stocks. In 1987, Meir Statman showed a minimum of 30 to 40 stocks are needed to form a well-diversified portfolio of randomly chosen stocks.

Therefore the investor needs to find out if there are enough stocks out there that are Shariah-compliant from which a fund manager can construct a well-diversified Shariah-compliant portfolio of about 30 to 50 strong companies. Approximately 85% of the securities listed on Bursa Malaysia are Shariah-compliant.

There are currently 269 stocks in the FTSE Bursa Malaysia EMAS Shariah index1. The Index comprises constituents of the FTSE Bursa Malaysia EMAS index that are Shariah-compliant according to the Securities Commission’s SAC screening methodology and FTSE’s screens of free float, liquidity and investability. This is a wide and deep enough investment universe with which to build a diversified portfolio of about 30 to 50 companies.

To give investors an idea of the caliber of companies in Malaysia that are Shariah-compliant, below is a list of the top 50 companies in the Index (as at 11/3/08).

1. Sime Darby Bhd

2. IOI

3. Telekom Malaysia

4. Tenaga Nasional

5. MISC

6. Kuala Lumpur Kepong

7. Digi.com

8. UMW Holdings

9. Gamuda

10. Plus Expressways

11. YTL Corp

12. Petronas Gas

13. PPB Group

14. YTL Power International

15. IJM

16. KNM Group

17. SP Setia

18. MMC

19. Parkson Holdings

20. Asiatic Development

21. AirAsia

22. Petronas Dagangan Bhd

23. Batu Kawan Bhd

24. UEM World

25. Dialog Group

26. Star Publication Malaysia

27. Lafarge Malayan Cement

28. Nestle (Malaysia)

29. Shell Refining Co (Malaysia)

30. WCT Engineering

31. United Plantation

32. KLCC Property Holdings

33. Malaysian Resources

34. Lingkaran Trans Kota Holdings

35. Kulim Malaysia

36. Malaysian Bulk Carriers

37. IOI Properties

38. Oriental Holdings

39. KFC Holdings

40. Titan Chemicals

41. Ta Ann Holdings

42. E & O Property Development

43. Keck Seng Msia

44. Top Glove Corp

45. Wah Seong

46. Petra Perdana

47. Puncak Niaga Holdings

48. Muhibbah Engine

49. Lion Industries

50. TSH Resources

This is a fairly impressive range of Shariah-compliant stocks with which to build a diversified portfolio. In addition, if the fund’s mandate allows investment in Shariah-compliant stocks across a region like the CIMB Islamic Asia Pacific Equity Fund, the investment universe grows exponentially. To give investors an idea of the number of regional stocks available to select from, there are 1,118 stocks included in the Dow Jones Asia Pacific Islamic index2.

1Source: FTSE International Limited, 11/3/2008. 2Source: Dow Jones, 29/2/2008

Special Feature

Special Feature

Comparison of Index PerformanceLet’s now compare the 10 year performance (as at end-Feb 08) of one of the widest Islamic indices available, the Dow Jones Islamic Market Index, to its conventional counterpart, the Dow Jones World Stock Index.

Looking at performance over the long-term from three different angles – monthly performance, cumulative performance, and rolling 3 years performance – has given us the same result: Similar Performance!

While at times performance did vary, over the long-term, both the Islamic and conventional index performed similarly.

What about risk adjusted returns? Does the Shariah-compliant index incur more risk and volatility because its investment universe is not as wide as the conventional index? Let’s take a look at the results for rolling 3 years volatility and rolling 3 years performance/risk profiles.

Hopefully this will help to resolve to some degree the mistaken perception that Shariah-compliant funds are substandard in performance as compared to their conventional counterparts.

Added Benefit of Shariah-Compliant InvestingIn order to be considered Shariah-compliant, a company must not be too leveraged in its capital management. Take the Dow Jones Islamic index methodology. Companies must meet three financial ratio requirements in order to make it onto a Dow Jones Islamic index:

• Total Debt to Trailing 12 Month Moving Average Market Cap Ratio must be ≤ 30%

• Account Receivables to Total Asset Ratio must be ≤ 45%

• Cash + Interest Bearing Securities to 12 Month Moving Average Market Cap Ratio must be ≤ 30%

The end result of meeting these three ratios is that Shariah-compliant companies may tend to be more resilient should an economic downturn suddenly occur compared to their conventional counterparts whose financial position may be more precarious because of their more leveraged financial position.

ConclusionWe have established that Shariah-compliant investment can be as diversified and perform on par with conventional investment. In addition due to its nature, Shariah-compliant companies have to be relatively conservative in their capital management. This option of investing is more inclusive as both conventional and Muslim investors can invest.

In fact, Malaysian investors may find it interesting to note that Shariah-compliant investing is attracting a lot of interest from the Japanese investment community, given its ethical stance, its transparency over product profitability – which provides an additional layer of risk management, and its defensive nature as it does not include financial stocks.

The results for monthly performance chart over 10 years?

Similar performance characteristics.

The results for cumulative performance chart over 10 years?

Similar performance.

The results for rolling 3 Years performance chart 10 years?

Similar performance.

15.00

10.00

5.00

0.00

-5.00

-10.00

-15.00

-20.00

%

Mar-98

Sep-

98

Mar-99

Sep-

99

Mar-00

Sep-

00

Mar-01

Sep-

01

Mar-02

Sep-

02

Mar-03

Sep-

03

Mar-04

Sep-

04

Mar-05

Sep-

05

Mar-06

Sep-

06

Mar-07

Sep-

07

DJ ISLAMIC MARKET INDEX DJ WORLD STOCK INDEX DJ ISLAMIC MARKET INDEX DJ WORLD STOCK INDEX

100.00

80.00

60.00

40.00

20.00

0.00

-20.00

-40.00

%

Feb-

98

Aug-

98

Feb-

99

Aug-

99

Feb-

00

Aug-

00

Feb-

01

Aug-

01

Feb-

02

Aug-

02

Feb-

03

Aug-

03

Feb-

04

Aug-

04

Feb-

05

Aug-

05

Feb-

06

Aug-

06

Feb-

07

Aug-

07

Feb-

08

200.00

150.00

100.00

00.00

0.00

-50.00

-100.00

%

DJ ISLAMIC MARKET INDEX DJ WORLD STOCK INDEX

Jan-

99

May-9

9

Sep-

99

Jan-

00

May-0

0

Sep-

00

Jan-

01

May-0

1

Sep-

01

Jan-

02

May-0

2Ja

n-03

Sep-

03

May-0

4

Jan-

05

Sep-

05

May-0

6

Jan-

07

Sep-

07

Jan-

08

May-0

7

Sep-

06

Jan-

06

May-0

5

Sep-

04

Jan-

04

May-0

3

Sep-

02

Monthly Return Chart Cumulative Return 10 Years Rolling 3 Years Return

The results for rolling 3 Years performance/risk over 10 years?

Similar performance/risk profiles.

3.00

2.50

2.00

1.50

1.00

0.50

-

-0.50

-1.00

-1.50


Jan-

99

May-9

9

Sep-

99

Jan-

00

May-0

0

Sep-

00

Jan-

01

May-0

1

Sep-

01

Jan-

02

May-0

2Ja

n-03

Sep-

03

May-0

4

Jan-

05

Sep-

05

May-0

6

Jan-

07

Sep-

07

Jan-

08

May-0

7

Sep-

06

Jan-

06

May-0

5

Sep-

04

Jan-

04

May-0

3

Sep-

02

Rolling 3 Years Performance/Risk

The results for rolling 3 Years volatility over 10 years? Similar performance.

%25

20

15

10

5

0


Dec-

98

Jun-

99

Dec-

99

Jun-

00

Dec-

00

Jun-

01

Dec-

01

Jun-

02

Dec-

02

Jun-

03

Jun-

04

Dec-

04

Jun-

05

Dec-

05

Jun-

06

Dec-

06

Jun-

07

Dec-

07

Rolling 3 Years Volatility

Source & Analysis: Bloomberg & CIMB-Principal Asset Management as at 29/02/08

Source & Analysis: Bloomberg & CIMB-Principal Asset Management as at 29/02/08

We recommend that you read and understand the contents of the Master Prospectus Issue No. 10 dated 30 June 2007 and its First Supplementary Master Prospectus dated 3 January 2008, CIMB-Principal Greater China Fund Prospectus No. 1 dated 01/06/07 and its First Supplementary Prospectus dated 01/07/07, CIMB-Principal ASEAN Equity Fund Prospectus dated 12/09/07, CIMB-Principal Climate Change Equity Fund Prospectus dated 27/09/07, CIMB Islamic Global Equity Fund Prospectus dated 8/01/08, CIMB-Principal MENA Equity Fund Prospectus dated 5/02/08, CIMB Islamic DALI Equity Theme Fund Prospectus dated 18/02/08 and CIMB Islamic Money Market Fund Prospectus dated 17/03/2008 which have been duly registered with the Securities Commission, before investing and that you keep the said Prospectuses for your record. Any issue of units to which the Prospectuses relate will only be made upon receipt of the completed application form referred to in and accompanying the Prospectus, subject to the terms and conditions therein. You can obtain copies of the Prospectuses from the head office of CIMB-Principal Asset Management Berhad or from any of our approved distributors. There are fees and charges involved in investing in the funds. We suggest that you consider these charges carefully prior to making an investment. Unit prices and income distributions, if any, may fall or rise. Past performance is not reflective of future performance and income distributions are not guaranteed. You are also advised to read and understand the contents of the Unit Trust Loan Financing Risk Disclosure Statement before deciding to borrow to purchase units. All performance figures have been verified by Mercer Zainal Consulting Sdn. Bhd. (35090-H).

For more information please contact your Financial Adviser or call our Client Service Representatives on 03 7718 3100. Alternatively, write to us at [email protected].

• CIMB-Principal Bond Fund and CIMB-Principal Strategic Bond Fund (Investments in the Funds are exposed to interest rate risk, credit risk (or default risk), liquidity risk and market risk.) • CIMB-Principal Global Titans Fund (Investments in the Fund are exposed to market risk, currency risk, country risk, security specific risk, liquidity risk, interest rate risk and credit risk.) • CIMB-Principal Emerging Asia Fund (Investments in the Fund are exposed to market risk, liquidity risk, country risk, currency risk and individual stock position risk.) • CIMB-Principal Balanced Fund (Investments in the Fund are exposed to market risk, interest rate risk, security specific risk and liquidity risk.) • CIMB-Principal Equity Aggressive Fund 3 and CIMB Islamic Equity Aggressive Fund (Investments in the Funds are exposed to market risk and security specific risk.) • CIMB-Principal Income Plus Balanced Fund and CIMB Islamic Balanced Growth Fund (Investments in the Funds are exposed to market risk, credit (or default) risk, interest rate risk, security specific risk and liquidity risk.) • CIMB-Principal Xcess Cash Fund, CIMB-Principal Xcess Income Fund and CIMB Islamic Short Term Sukuk Fund (Investments in the Funds are exposed to interest rate risk and credit risk. ) • CIMB-Principal Small Cap Fund (Investments in the Fund are exposed to market risk, liquidity risk and security specific risk.) • CIMB Islamic Enhanced Sukuk Fund (Investments in the Fund are exposed to interest rate risk, credit risk and liquidity risk.) • CIMB-Principal Global Asset Spectra Fund (Investments in the Fund are exposed to market risk, country risk, currency risk, interest rate risk, credit risk, risks associated with investment in global property-related assets and global commodity-related assets, and fund manager’s risk.) • CIMB Islamic Asia Pacific Equity Fund (Investments in the Fund are exposed to market risk, stock risk, country risk, currency risk and liquidity risk.) • CIMB-Principal Greater China Fund (Investments in the Fund are exposed to market risk, country risk, liquidity risk, risk associated with investment in foreign securities, currency risk, fund manager’s risk, market risk, country risk, liquidity risk, risk associated with investment in foreign securities and currency risk.) • CIMB-Principal ASEAN Equity Fund (Investments in the Fund are exposed to market risk, liquidity risk, country risk, currency risk, fund manager’s risk and risks associated with ETF investment.) • CIMB-Principal Climate Change Equity Fund (Investments in the Fund are exposed to market risk, liquidity risk, legal and tax risk, risk of assets in the emerging markets, counterparty risk, country risk, currency risk, risk associated with investment in foreign securities, interest rate risk, credit risk, risk of default and fund manager’s risk.) • CIMB Islamic Global Equity Fund (Investments in the Fund are exposed to market risk, stock specific risk, country risk, currency risk, liquidity risk, and risk associated with investment in emerging markets.) • CIMB-Principal MENA Equity Fund (Investments in the Fund are exposed to fund manager’s risk, currency risk, market risk, equity risk, currency risk, risks of investing in emerging markets generally and risks specific to MENA markets.) • CIMB Islamic DALI Equity Theme Fund (Investments in the Fund are exposed to market risk, sector risk, stock specific risk, liquidity risk and reclassification of Shariah status risk.) • CIMB Islamic Money Market Fund (Investments in the Fund are exposed to risks are credit risk, interest rate risk, liquidity risk and inflation/purchasing power risk.)

Best of Best Country Awards:CEO of The Year (Malaysia)

Datuk Noripah KamsoCIMB-Principal Asset Management by

Asia Asset Management Awards 2008

HEARTIEST CONGRATULATIONS

Diversify across the Middle East and North Africa (MENA) amidstglobal uncertainty.

CIMB-PRINCIPAL MENA EQUITY FUND

The MENA region has one of the lowest correlations with the world markets, offering you a unique opportunity to diversify your portfolio in a land of abundance.

The MENA region is driven by massive oil wealth - over US$60 billion in 2006 - and unprecedented government expenditure of US$1.5 trillion for the next 5 years*

Accelerating oil demand** fuels the growth of other sectors such as banking and finance, telecommunications and real estate Low correlation between the MENA region and MSCI World, Nikkei and S&P500 enables you to truly diversify your investment portfolio

To enjoy the potential rewards that the MENA region can bring, please call our distributors below:1 300 880 900 (CIMB Bank), 03-2723 8688 (CIMB Private Banking), 03-7718 3000 (CIMB Wealth Advisors),1 300 303 300 (Citibank), 1 800 388 888 (Hong Leong), 1 300 885 000 (OCBC), 03-2715 9802 (Philip Mutual),03-2732 4332 (UOB) or visit www.cimb-principal.com.my.

* Source: HSBC Global Research, Meed, Thomson Financial Datastream

** Oil demand is estimated at 118 million barrels per day by 2030

Please refer overleaf for important disclosures

Disclaimer: We recommend that you read and understand the contents of CIMB-Principal’s Master Prospectus Issue No. 10 dated 30/06/07 & its First Supplementary Master Prospectus dated 03/01/08 and CIMB Wealth Advisors’ Master Prospectus dated 03/01/08, all of which have been duly registered with the Securities Commission, before investing and that you keep the said Prospectuses for your records. Any issue of units to which the Prospectuses relate to will only be made upon receipt of the completed application form referred to in and accompanying the Prospectuses, subject to the terms and conditions therein. You can obtain

copies of these Prospectuses from our head office, branch offices or approved distributors. There are fees and charges involved in investing in the funds. We suggest that you consider these charges carefully prior to making an investment. Unit prices and income distributions, if any, may fall or rise. Past performance is not reflective of future performance and income distributions are not guaranteed. You are advised to read and understand the contents of the Unit Trust Loan Financing Risk Disclosure Statement before deciding to borrow to purchase funds.

• CIMB-PrincipalXcessCashFund,CIMB-PrincipalXcessIncomeFundandCIMBIslamicShortTermSukukFund Investments in the Funds are exposed to interest rate risk and credit risk.

• CIMB-PrincipalBondFundandCIMB-PrincipalStrategicBondFund, Investments in the Funds are exposed to interest rate risk, credit risk (or default risk), liquidity risk and market risk.

• CIMB-PrincipalIncomePlusBalancedFundandCIMBIslamicBalancedGrowthFund Investments in the Funds are exposed to market risk, credit (or default) risk, interest rate risk, security specific risk and liquidity risk.

• CIMB-PrincipalBalancedFund Investments in the Fund are exposed to market risk, interest rate risk, security specific risk and liquidity risk.

• CIMB-PrincipalEquityAggressiveFund3andCIMBIslamicEquityAggressiveFund Investments in the Funds are exposed to market risk and security specific risk.

• CIMB-PrincipalSmallCapFund Investments in the Fund are exposed to market risk, liquidity risk and security specific risk.

• CIMB-PrincipalGlobalTitansFund Investments in the Fund are exposed to market risk, currency risk, country risk, security specific risk, liquidity risk, interest rate risk and credit risk.

• CIMB-PrincipalEmergingAsiaFund Investments in the Fund are exposed to market risk, liquidity risk, country risk, currency risk and individual stock position risk.

• CIMB-PrincipalGlobalAssetSpectraFund Investments in the Fund are exposed to market risk, country risk, currency risk, interest rate risk, credit risk, risks associated with investment in global property-related

assets and global commodity-related assets, and fund manager’s risk.

• CIMBIslamicEnhancedSukukFund Investments in the Fund are exposed to interest rate risk, credit risk and liquidity risk.

• CIMBIslamicAsiaPacificEquityFund Investments in the Fund are exposed to market risk, stock risk, country risk, currency risk and liquidity risk.

• CIMB-PrincipalBondFund2 Investments in the Fund are exposed to market risk, credit risk, inflation/purchasing power risk, interest rate and liquidity risk.

• CIMB-PrincipalKLCI-LinkedFund2,CIMB-PrincipalEquityGrowthFund,CIMB-PrincipalEquityIncomeFund,CIMB-PrincipalEquityFund2,CIMB-PrincipalKLCI-LinkedFund,CIMB-PrincipalEquityFund,CIMBIslamicSmallCapFund,CIMBIslamicSukukFund,CIMBIslamicBalancedIncomeFund,CIMBIslamicDALIEquityGrowthFundandCIMBIslamicDALIEquityFund

Investments in the Funds are exposed to market risk, stock specific risk and liquidity risk.

• CIMB-PrincipalEquityGrowth&IncomeFundandCIMB-PrincipalSmallCapFund2 Investments in the Funds are exposed to market risk, stock specific risk, liquidity risk and currency risk.

• CIMB-PrincipalEquityFund4,CIMB-PrincipalBalancedGrowthFund,CIMB-PrincipalBalancedIncomeFund,CIMB-PrincipalEquityFund3,CIMB-PrincipalGlobalGrowthFund,CIMB-PrincipalGlobalBalancedFund,CIMB-PrincipalAsianEquityFundandCIMBIslamicMicroCapFund

Investments in the Funds are exposed to market risk, stock specific risk, interest rate risk, credit risk and liquidity risk.

• CIMB-PrincipalMoneyMarketFund Investments in the Fund are exposed to credit, liquidity and interest rate risk.

• CIMB-PrincipalEquityAggressiveFund2 Investments in the Fund are exposed to market risk, sector specific risk, and liquidity risk.

• CIMB-PrincipalEquityAggressiveFund1 Investments in the Fund are exposed to market risk, stock specific risk, liquidity risk, effect of leverage risk, limited life risk and general market risks.

• CIMBIslamicEnhancedIndexFund Investments in the Fund are exposed to market risk, stock specific risk, Shariah non-compliant risk and liquidity risk.

• CIMBIslamicEquityFund Investments in the Fund are exposed to a higher degree of volatility due to exposure to market risk.

• CIMBIslamicBalancedFund Investments in the Fund are exposed to market risk, stock specific risk, credit risk and liquidity risk.

Disclaimer: We recommend that you read and understand the contents of CIMB-Principal’s Master Prospectus Issue No. 10 dated 30/06/07 & its First Supplementary Master Prospectus dated 03/01/08 and CIMB Wealth Advisors’ Master Prospectus dated 03/01/08, all of which have been duly registered with the Securities Commission, before investing and that you keep the said Prospectuses for your records. Any issue of units to which the Prospectuses relate to will only be made upon receipt of the completed application form referred to in and accompanying the Prospectuses, subject to the terms and conditions therein. You can obtain copies of these Prospectuses from our head office, branch offices or approved distributors. There are fees and charges involved in investing in the funds. We suggest that you consider these charges carefully prior to making an investment. Unit prices and income distributions, if any, may fall or rise. Past performance is not reflective of future performance and income distributions are not guaranteed. You are advised to read and understand the contents of the Unit Trust Loan Financing Risk Disclosure Statement before deciding to borrow to purchase funds.

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