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| APRIL 2006 NEWSLETTER On the topic of investing in India We have been on the forefront of demographic investing and planning since 1999. Our investment policy put a percentage of your portfolio in Asia- ex Japan before the annual mutual fund surveys noticed that the three-year returns were astounding. (In fact, Matthews Asian Growth and Income (MACSX) is now closed to new investors. As your advisor, we still have access to it for all our clients due to our prior participation.) India has been a part of those holdings for a while. For example, 10% of Matthews Pacific Tiger (MAPTX) is currently invested in India. Thus, a portfolio with 20% in Asia ex-Japan via this fund would have 2% in India. We believe it is time to increase that investment exposure. Why? The reason, as always, is demographics. Notice that we shy away from the developing nations of Latin American. Notice how we actively shun Japan. In order for an economy to be stable it must be driven by predictable consumption and spending. It also requires companies that make money while meeting that demand. Either you produce for others or you produce for yourselves... preferably you do both. Latin America has not yet closed the gap enough between the rich and the poor in order to have a growing middle class of free spending consumers. Japan is predominantly a nation of retirees. The Japanese baby boom peaked in the late 1940’s, ten years prior to our own boom and others around the world. Japan shuns immigration. They have been in an economic downturn since their baby boomers stopped spending 47 +/- years since that peak. The central bankers could not revive their economy with 0% interest rates, but that is a topic for another newsletter. India has been the beneficiary of the Internet, Voice over IP telephony, and a strong belief in the power of education. Do you notice any similarities with Korea, Taiwan, Singapore and China? We are all aware of the flow of formerly US-based jobs to India and Asia. Like it or not, the wave will continue. Rather than complain, let’s flow with it and attempt to take advantage of the investment opportunities this presents. India has a highly developed economy and financial infrastructure. We believe the area is stable and safe for long-term investors using experienced managers. We also believe that we may be early to the table, much like we were with Asia ex-Japan. We believe this to be a good thing. As we go through the next quarter please expect your portfolio recommendations to include a change in allocation that includes approximately 5% directly to India. We will discuss the actual investment vehicles and strategy for future rebalancing at that time. Disclaimers: Opinions and forecasts regarding industries, companies, and/or themes, and portfolio composition and holdings, are all subject to change at any time, based on market and other conditions, and should not be construed as a recommendation of any specific security. Investing in securities involves risk. There is no assurance that the investment process will consistently lead to successful results. If your financial situation or investment objectives have changed, you should notify Dominion Wealth Management, Inc. immediately. Best from Dominion Wealth,  | |
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Revising Dent's Expectations
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IRA ADVISOR NEWSLETTER 2006
Trow profiled in the April Newsletter
MATTHEWS ASIA NOW
NEWSLETTER 2006
The Demographics Issue
BNET BUSINESS NETWORK 2001
Ready to Retire