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Phuket Lifestyle – jury is still out on litigation funding

Legacy Phuket Gazette

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Phuket Lifestyle – jury is still out on litigation funding | The Thaiger

PHUKET: One very exciting new asset class available to individual investors that I have been looking into is litigation funding. When I first heard about some notes attached to this I thought it sounded too good to be true and dismissed it, but as sometimes is the case, extraordinary opportunities can arise.

The asset class is currently only accessible via structured notes, but these work very differently than most other forms of investment, which I usually think are a rip-off. I have heard a fund structure is currently being put together for listing on the Irish exchange and this really excites me.

Litigation is expensive and often fairly clear-cut cases are not tried because the costs of going to trial are prohibitive. We all know the story of David and Goliath, and many big corporations often get away with misdeeds simply because it is too difficult to fight a “Goliath” team of high-paid of lawyers.

Litigation funding levels the playing and helps David. The notes I have looked into have always been commercial litigation, so it is not helping lowlifes chase frivolous cases hoping for a quick buck.

The interesting thing is that insurance companies will actually insure cases they consider to be clear-cut. The costs are included in the structure and insurance costs are even covered in the insurance. So, if the case is lost, the insurance company is on the hook and the investors have their capital protected.

I am not a big fan of guarantees, but this one appears to hold water. Insurance companies are not big risk-takers, and they only insure cases that are “sure” wins. As such, the win ratio of funded litigation is very high – and the premiums collected are pretty large as well, as insurance companies aren’t charities, either.

Despite the costs of insurance and financing, the potential take from profitable lawsuits can be large, as well as participation in the award amount.

Apparently the market for unfunded litigation is enormous. As it stands now, the cases never move forward because the companies can’t afford them and the litigation funding market is still relatively small.

I am not yet convinced of the actual way this opportunity is packaged, but I am still doing my homework and waiting to see how things unfold for some people who I know are willing to be investor guinea pigs.

However, I am convinced of the concept, but in the investing world that isn’t enough. You may have known computers were the future 25 years ago, but if you threw all of your money into Tandy you’d probably be kicking yourself now.

The reason I believe this asset class could become exciting very quickly is that it is completely unrelated to traditional and even almost all other alternative asset classes. It doesn’t matter what is happening in the stock markets, bond markets, economy or elsewhere.

Litigation funding could be a great addition to a portfolio to lower overall volatility and increase returns. I will continue to see how this market grows and will most likely be writing about this again in the future.

I would be very careful, however, of sticking a large percentage of your portfolio into a new asset class – at least “new” in terms of being geared towards individual investors, as there has been corporate litigation funding for quite some time.

David Mayes MBA provides wealth management services to expats around the globe, specializing in UK pension transfers. He can be reached at [email protected]

— David Mayes



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BOI approves new rail services, new port investment

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BOI approves new rail services, new port investment | The Thaiger

PHOTO: Duangjai Asawachintachit, BOI secretary general

The Board of Investment of Thailand (BOI) has laid out strategies to boost the development of rail services and the country’s cruise tourism.

Duangjai Asawachintachit, BOI secretary general, says the latest BOI meeting chaired by the Prime Minister had resolved to instigate measures to attract investment in rail development and related infrastructure for continued economic growth.

According to Duangjai, investment projects for rail development and related sectors will be entitled to a tax break of 50% for the first three to five years of investment.

The BOI also approved measures to stimulate the cruise tourism business, with the aim of attracting more tourists to the kingdom.

Moreover, the BOI has introduced a plan to attract aerospace investment to U-Tapao Airport in 2019 as part of the Eastern Economic Corridor (EEC) project, as the EEC Office is planning to develop an “Aerotropolis” which will stretch over 30 kilometers from the airport.

Additionally, the meeting endorsed the 7-year strategic investment promotion plan, spanning 2015 to 2021, which it is anticipated will contribute 418 billion baht to the country’s GDP.

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Chinese foreign policy – On track

The Thaiger

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Chinese foreign policy – On track | The Thaiger

by Nikkei Asia Review

“When Japanese trading house Itochu and train maker Hitachi withdrew from a soon-to-be-decided $7 billion tender for a high-speed rail project near Bangkok, it appeared to be another victory for China and its grand plans to connect Southeast Asia with railways.

Thailand has for decades been the centerpiece of Tokyo’s strategy for Southeast Asia, and long-discussed plans to build extensive shinkansen-style rail lines in the country’s east and north were meant to cement the relationship between the two nations.

But while Japan’s ambitions have been stalled by disagreements about financing and other details, Beijing has managed to push ahead with construction of a separate high-speed rail line in northern Thailand. To some, the rail projects are a symbol of China’s growing influence in a country where Japan had spent decades building ties.”

The article predicts that the Chinese investment into South East Asian rail services is part of its broader ‘belt and road’ policy that is stretching out into new routes and connecting regions, and China, with hitherto remote parts of the asian continent.

“China’s high-speed rail ambitions in Southeast Asia don’t end in Bangkok, however. Under its planned 3,000-km pan-Asian railway network, Chinese rail lines will extend even further south, stretching through Malaysia and feeding into Singapore.”

Chinese foreign policy - On track | News by The Thaiger

China’s reach southwards will allow it to exert greater political influence on places like Singapore which, for now, still retains strong connections to Washington. Investing in high-speed railways all the way from China’s borders to the tip of the Malay Peninsula is a lot more than just an economic investment, it’s a high-profile symbol of China’s new influence in the region where issues such as ‘Taiwan’ and it’s demands in the South China Sea have caused prickly negotiations with the ASEAN countries.

But to reach Singapore, China must first get Malaysia on side…

“A dramatic recent shift in Malaysian politics has put China’s plans for Singapore on hold, however. After his election in May, Malaysian Prime Minister Mahathir Mohamad decided to hold up “for now” the $20 billion 688-km east coast rail line connecting southern Thailand to Kuala Lumpur, and postpone for two years a 350-km high-speed rail link between the Malaysian capital and Singapore.”

The article says that these ‘investments’ are actually just loans for high-priced infrastructure that often cannot be repaid by smaller economies….

“China typically provides loans, not grants, for foreign infrastructure projects, and takes possession of the project if the recipient is unable to repay its debt – as happened with a port in Sri Lanka. Such instances have prompted critics in the West to accuse China of practicing ‘debt diplomacy’.”

Read more of this fascinating and important article from Nikkei Asia Review HERE.

Chinese foreign policy - On track | News by The Thaiger

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Thailand opens doors to cryptocurrencies – Thaiger Bites

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Thailand opens doors to cryptocurrencies – Thaiger Bites | The Thaiger

Divisions are forming across Asia with regards to cryptocurrencies. Some nations such as China are constantly stomping on anything to do with crypto assets but others, Thailand being the latest, are opening their digital doors to the fledgling industry.

Over the past year Thailand has warmed to crypto and this latest raft of official licenses is a big boost to the industry in the country and region as a whole. Military rulers and the central bank remains wary which is no surprise and have issued warnings to investors. Overall though the sentiment is positive and an official ICO portal has even been proposed by the SEC.

Read more about this story from News BTC HERE.

(Thaiger Bites provides these short snippets for stories we believe of interest to our readers)

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