News from Asia Pacific Fund
Information in this section will be found of interest to investors who want to learn more about hedge fund investing.
Asia Pacific Fund is pleased to announce our new arrangement to offer Interest-Bearing Government Obligations issued by the People's Republic of China (PRC) to our qualified investors.
As a qualified institutional investor, Asia Pacific Fund invests in PRC Bonds as a part of our diverse bond portfolio. Private investors benefit from long-term secure positions when they participate in the Asia Pacific Fund bond fund.
Asia Pacific Fund also invests in private high-quality low-risk obligations including Chinese and other Asian industrial development bonds. China is continuously undertaking numerous projects, in both the public and private sector, ranging from energy development to shipbuilding. Most notably, hydroelectric power plants are being built in China on a grand scale.
The People's Republic of China currently has over 750 hydro projects awaiting U.N. approval and is adding an average of 25 more per month. These projects are expected to generate more than 300 million "certified emission reductions," each representing reduction of one ton of carbon dioxide. Even at recent depressed market prices, those credits would be worth 4 billion USD.
One method China is using to finance these new projects is the refinancing of projects that have already been completed, which releases capital for further new developments. It is much easier to refinance an existing hydropower project that is fully operational than a green-field project, because many of the risks that deter financiers occur at the construction stage. Once a project is built and has a secure revenue stream, it becomes an attractive investment suitable for the long-term investments, such as Government-issued bonds.
In established economies like China where there is a strong domestic debt market based on Government bonds, and where large hydro schemes are mainly financed in the public sector, the principle of refinancing hydro projects is already well established. A recent example was the successful refinancing of a portion of the debt on the Three Gorges Dam project through a public bond offering which was heavily oversubscribed.
Bank of China is currently issuing bonds with the goal of raising 2.2 billion USD for the construction of 4 new dams—the Baihetan Dam, Wudongde Dam, Maji Dam, and Songta Dam—that will generate a total of 27,900 megawatts of power when completed in 2020. Chinese commercial banks began offering these new equity positions to qualified Chinese investors in 2018.
Through its bond fund, Asia Pacific Fund offers private investors the opportunity to safely earn attractive returns from PRC General Obligations and Bond Issues.
We challenged the Asia Pacific Fund analytical team to identify the "Top 100 Sustainable Companies in Asia and Europe." What they discovered is that there are only 60 companies, worldwide, which fit our rigid criteria for having their base in either the Asia-Pacific or the Western Europe/Scandinavian regions and which are also uniquely sustainable by virtue of their history, market position, and documented steady performance in both good and bad economic climates.
You can be confident that when you invest in the Asia Pacific Fund, that your portfolio includes not only new and unique opportunities, but also a broad range of investments that are diverse, rock-solid, and that have been well-researched.
These are the 60 companies that we identified:
The Asia Pacific Fund Fund is now available to U.S. investors. We will provide stable offshore opportunities to qualified American investors using the same time-tested governing principles that have benefited our European and Asian clients since 2019. We fully anticipate that the general recovery of the American stock market, American financial institutions, and American industry will be long and slow. Americans must diversify and move at least some of their holdings offshore during this tumultuous period.
There are currently many exciting opportunities in the commodities, equities, and currency markets. There are significant profits to be made during the next 3 to 5 years as the U.S. slowly pulls itself out of the recession, with the less-depressed European Union and Asian markets taking the lead. Asia Pacific Fund offers a unique opportunity for American investors with sufficient liquidity to reap the benefits of future market upswings.
Asia Pacific Fund is not immune to periods of economic recession; however, we have done several things to protect our investors. First is the breadth and depth of the application of leveraged or borrowed money in investing strategies. Whether it's hedge funds or other investors, more and more investment is happening on a leverage basis and what that does is amplify the market or risk exposure in an investment. Asia Pacific Fund does not use leverage. We don't have leverage in our investment portfolios, but it is very commonly used across the investment universe by our competitors and by other investors. The net result is that when things go badly, an investor who's leveraged many times is forced into a forced liquidation. They have to sell assets in order to raise money to pay back their lenders. That cycle creates market-valuation changes that are bigger than anyone expected. And it can lead to a liquidity freeze-up where the leveraged investors who need to sell aren't able to find counterparties who have the liquid assets to buy their investments, and that furthers the dislocation.
Secondly, we have created a class of "foul weather" investing strategies for the more conservative investor. This class includes traditional bonds, where we invest in low risk assets such as government savings bonds, treasury bills, and tax-free municipal bonds. This class also includes capital-guaranteed funds. Investments in these funds are underwritten and guaranteed by zero-coupon bonds from stable and conservative Asian banks, such as Bank of China, that have been largely unaffected by the recent wave of credit crises. This means your investment is safe and secure, regardless of market conditions.
The Western Kazakhstan-China pipeline will allow new sources of oil to flow to China, diversifying supply and helping to satisfy booming Chinese energy demands.
Chinese companies are acquiring significant oil resources in western Kazakhstan for later stage shipment to China once the Kenkiyak-Aralsk-Kumkol section of the pipeline is completed.
In its initial stages, the new pipeline will rely on attracting foreign joint ventures in Kazakhstan to fill the pipeline with oil destined for China through the Atasu-Alashankou section.
Asia Pacific Fund is strategically positioned to exploit this opportunity with our Russian associate, Alliance Group. Alliance is leading a team of joint venture exploration and drilling companies that is developing the Kazakh oil fields. Asia Pacific Fund will provide equity capital and develop later public offerings as the project matures.