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Strategies & Market Trends : Asia Forum

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To: peter michaelson who wrote (1866)2/3/1998 12:50:00 AM
From: peter michaelson  Read Replies (3) of 9980
 
One rationale behind the difference in premium between, for example, Malaysia Fund and Malaysia Webs might be that MF investments are in shares (of Malaysian businesses)that are eligible to be held by only local Malaysians but not by foreigners while EWM holds shares (of the same companies) that are available to foreigners.

Since the foreigners' shares often sell at premiums (Korea is well-known for its 100% premium foreigner shares), then MF's premium may be composed mainly of the foreigner premium, and is in fact at no higher a premium than EWM if using the local share price as benchmark.

Is this true? Any thoughts would be much appreciated

TIA peter
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