I hate trigger funds with a vengence purely because of the set up whereby if an x% return is achieved then the fund is closed, if the x% return is not achieved then customers are given back whatever the final result is or given the underlying stocks instead. So essentially you’re buying an option with limited upside and massive potential downside.

The fee structure of these things are also incredibly high, just go have a look at One Asset Management’s website, front-end fees up to 2%, back end fees @ 1%, management fees annualised to just over 2%, so upwards nearly 4% of your return gone, this net return for investors is awful. But hey if there’s demand for such a short term product why not right?

Of 90 trigger funds launched last year with net assets of 38 billion baht, 56 funds with net assets of 28 billion baht carried over to 2014, according to Peet Yongvanich, managing director of Morningstar Thailand. He said the average return for the funds was -12%. By the end of the first quarter, six of the 56 funds closed altogether with losses for investors, while 10 converted to normal open-ended equity funds

 Source: Bangkok Post