KENANGA ANNUAL REPORT 2018

17 ANNUAL REPORT 2018 GROUP MANAGING DIRECTOR’S MANAGEMENT DISCUSSION AND ANALYSIS where downside risks are mitigated with a well-diversified portfolio that is not constrained by any benchmarking. To provide clients with more choices in currency investments, KIG launched the Kenanga AUD Alternative Income Fund Series 2 in December. Like its first (1 st ) series, it offers investors an option to invest in their preferred currency class, as well as, to preserve their investment over a short one (1) year duration. Over the year, KIG’s financial products did not go unrecognised, garnering the Core Equity – Malaysia (Kenanga Growth Fund) and the Balanced – Malaysia (Kenanga Balanced Fund) awards at the Fundsupermart.com Recommended Unit Trusts Awards 2018/ 2019. Hong Kong’s 2019 Best of the Best Awards by Asia Asset Management announced KIG as the winner of three (3) awards – Best Equity Manager, Best Wealth Management Platform and Best Investor Education under the country category (Malaysia). At the 2019 Morningstar Awards, Kenanga Blue Chip Fund won the Best Malaysia Large – Cap Equity Fund award, while its Kenanga Syariah Growth Fund was recognised as Most Outstanding Islamic Fund Product by the Kuala Lumpur Islamic Finance Forum. As a responsible asset manager, KIG is committed to the best investment management practices, and since becoming a signatory to the Malaysian Code of Institutional Investors (“ the Code ”) in early 2018, KIG has worked to incorporate principles of the Code in the pursuit of sustainable and consistent returns. As a result of the responsible practices, MARC reaffirmed the IMR-2 rating of KIG, which reflects its well- established investment processes, sound risk management practices and strong operating track record. In September 2018, KIG received the inaugural Transparency Award 2017 from MARC’s 2017 Lead Managers League Table Awards. Outlook KIG will continue to grow its client segments and further enhance its distribution channels i.e. Agency, Private Wealth, Business Partners and Institutional Sales Team. Going forward, KIG will also be offering a full suite of wealth and financial planning products, while WM will continue to work on increasing revenue through the offering of products from the Group and external parties’ sales to the various distribution channels. Segmental Review: Listed Derivatives Kenanga Futures Sdn Bhd’s (“ KF ”) performance was affected by the difficult market conditions which resulted in a moderation of the overall volume in the Malaysian derivatives market. KF recorded a LBT of RM2.76 million in 2018 compared to the LBT of RM1.06 million in 2017. Despite market challenges, KF increased its market share to 9.1% through several initiatives such as marketing campaigns and educational seminars. It also expanded the product suite to include CME Group products. The second (2 nd ) edition of the Back 2 The Futures campaign that ran from August to November, was launched to encourage retail participants to trade both Bursa Malaysia Derivatives Berhad (“ Bursa Malaysia Derivatives ”) and CME Group products by using its KDF TradeActive™ platform. KF continues to maintain its market leadership position in the derivatives space. For the sixteenth (16 th ) consecutive year, KF was awarded Best Trading Participant Equity and Financial Derivatives (Champion) at the Bursa Excellence Awards 2018. It also clinched Best Institutional Derivatives Trading Participant (Champion), as well as, Best Overall Derivatives Trading Participant (First (1 st ) Runner Up).