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Arca Far East Fund: Opinions

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Arca Far East Fund: Opinions

Independent Financial Advisor and Co-Founder of Affari Miei

7 March 2024

Have you heard of the fondo Arca Far East (ISIN: IT0001033528) and do you want to know if it could be an interesting solution for your investments?

Today we will analyze this fund starting from KID (Key Investor Document) and we will focus on the most important aspects of the fund, to better understand what they are characteristics to consider and above all what are the advantages they disadvantages of an investment made in mutual funds.

Enjoy the reading!

This article talks about:

Arca SGR: two words

Let’s start with a presentation of the company: Arca SGR is an asset management company with solid experience, founded in 1983 and based in Milan. The company stands out for offering excellent products and services, aimed at a diversified clientele.

The structure of Arca SGR is based on a network of 100 entities selected from credit institutions and financial companies, responsible for the placement of all the funds managed by the company. This network extends through over 8,000 branches and financial promoters, reaching approximately 860,000 subscribers to the funds managed.

An important point in Arca’s strategy is the commitment towardssustainable investment.

In 2019, Arca Fondi joined the United Nations Principles for Sustainable Investment (UNPRI). This choice reflects Arca’s belief that saving can have a positive impact on the environment and society, helping to build a more sustainable future. This commitment demonstrates the social responsibility of Arca SGR and its vision aimed at making a positive contribution to the environment and the community in which it operates.

Arca Far East ESG fund profile

Arca Far East ESG is a mutual investment fund that belongs to the Arca ESG Leaders system.

The fund has a duration until 31 December 2100 unless extended, and the liquidation of the fund can take place even before that date in the event of dissolution of the SGR or resignation motivated by the existence of a just cause.

The bottom is equitysustainable and responsible and promotes ESG characteristics.

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What does the fund invest in?

The fund mainly invests in shares of Pacific area issuers large capitalization with stable growth prospects over time and highly liquid, mainly denominated in yen, dollars and other Pacific area currencies.

There is no structural coverage of exchange rate risk. Exposure to currency risk is actively managed. The geographical investment areas are mainly countries belonging to the Asian and Pacific area, both developed and emerging.

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The fund uses derivative instruments for risk hedging purposes and for purposes other than hedging (including arbitrage).

This is the geographical area that you will find yourself having in your portfolio if you choose this fund.

The benchmark

The benchmark index is 100% MSCI AC Asia Pacific ESG Leaders Net TR.

The management style of the fund however is active and there is a possible deviation from the benchmark.

We need this to have an overview of the performance and progress of the investment.

Risk/reward profile

Considering the potential risk of an investment is important, as risk exposure is one of the first things to consider.

If your strategy is oriented towards protecting capital, you will certainly not be able to opt for a very risky fund, just as, on the contrary, if you have a very long time horizon and want to obtain higher returns you will necessarily have to choose a fund with a higher risk. at least equal to 5.

Arca Far East ESG has a risk level of 4 on a scale of 1 to 7, so we are on a medium risk.

Subscription, disinvestment and distribution of proceeds methods

It is possible to subscribe to fund shares at any time, either through a single payment (PIC) of a minimum amount of €100, or with periodic investment (PAC), paying minimum amounts of €100. Subsequent minimum payments must also be €100.

There are no particular indications for disinvestyou can do so at any time by asking the SGR for a refund of the value of your shares.

The proceeds realized are managed with the ad method accumulation, this means that they are not distributed among investors but are reinvested in the fund’s assets itself. This strategy is suitable for those who have a long time horizon and want to exploit the power of compound interest.

The costs of the Arca Far East ESG fund

Check the charges to bear has always been the most important thing to do, as they are the costs that impact returns and which can contribute to determining the positive or negative outcome of your investment.

The cost table can also be useful for comparing two different funds and choosing the most convenient one.

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Let’s look at the costs in detail:

Subscription Charges: fixed fees of €3.50;
Exit costs: fixed fees of €3.50;
Management fees: 1.95% of the investment value per year;
Transaction costs: 0.13% of the investment value per year.

The recommended holding period is 6 years.

If you want to learn more, in this report we explain how an investment that is too expensive can produce tens of thousands of euros less in returns.

Historical returns

Past returns should not be understood as a measure of future returns and, above all, they have no value in comparison with them.

They are used to have a simple overview of fund performance and to understand how it is going.

I attach the screenshot taken directly from the official website.

As you can see we took a time frame from March 2021 to March 2024.

After an initial period in which the fund and benchmark were almost equal, the fund began to lose a bit.

It is almost always difficult for the fund to outperform the benchmark, because in managed savings it is not easy, despite the manager.

Performance scenarios

Since 2023, European legislation has provided that i KID of financial products had a section dedicated to performance scenarios.

I attach it to you screen:

As you can see, scenarios are shown for both exit after 12 months and exit after the recommended 6 year holding period.

The situation is as follows:

Exit after 1 year
Exit after 6 years

Stress -64.18% -18.03% Unfavorable -22.19% -3.00% Moderate 3.16% 4.80% Favorable 37.93% 7.25%

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Affari Miei’s opinions on the Arca Far East ESG fund

We have reached the end of the review on Arca Far East ESG fund.

You were able to see all of his characteristics and above all you have investigated all the most important aspects of the investment.

Up here My business we are not great supporters of mutual investment funds, regardless of the characteristics of this fund, because they present significant critical issues that must be considered.

In fact, mutual funds are products complicatedinefficient and have high costs.

I costs unfortunately they impact the final returns of your investment and, in the case of mutual funds, they are high.

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Another thing you have to consider when you invest and choose to invest is the conflict of interest between the collaborator and the client: whoever sells you these funds in fact has interests that are not solely and exclusively yours.

If you are interested in understanding more about these products, we have a free report in which we explain the critical issues of these products in detail: reading it could help you save thousands of dollars every year.

In our investment strategy we prefer to use ETF: they are investment funds but they are listed on the stock exchange and being passively managed they can offer extremely lower costs.

They are purchased independently and simply replicate an index rather than beat it: this usually means better performance and above all total awareness of how your money will be invested.

This fund has a objective of investment linked to capital growth and, above all, it invests in a sustainable way: if we were to just look at this point we would undoubtedly have to say that it is an interesting solution and worth considering.

However, we must not forget the costs and inefficiency that often hide behind similar tools.


I hope I have removed any doubts about this sustainable fund proposed by Arca SGR and above all that the article has allowed you to get the best information possible. In fact, I believe that before proceeding with any investment the most important thing is to inform yourself and obtain all the information.

If you are curious to discover the behind the scenes of managed savings, conflicts of interest and the very high costs of open-end mutual funds, I recommend you download and read our free report in which we review all their critical issues.

In case you are interested in finding out more about how Affari Miei approaches the world of personal finance and investments, instead, you can start here.

Before saying goodbye, I also want to leave you a few things guide that you can read to broaden your knowledge:

See you soon and good investments!

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