AsianInvestor’s top fund houses by country, Part 1
Every year, AsianInvestor's editorial team conduct an intensive analysis of the region's leading asset management service providers, fund products and asset managers, to ascertain the top organisations of the previous 12 months.
The winners of these categories must combine a mixture of business performance, growth and progress, measured on both quantitative and qualitative criteria. Below, we detail why we chose the first half of this year's winners of our market awards category, which comprise the top fund houses operating across key Asia-Pacific territories.
AUSTRALIA
Platinum Asset Management
Platinum Asset Management’s experienced team of fund managers put some sophisticated investment strategies to work in 2017 to deliver table-topping performance. Five of Platinum’s investment funds returned above 30% last year with its flagship International Fund returning 27.4%.
In the year to end-January 2018 funds under management rose by A$4.8 billion ($3.7 billion) or 21%, owing to a mix of net inflows and strong performance in equities. Total assets now stand at A$28 billion. The year saw Platinum announce plans to launch exchange-traded versions of its international and Asian funds, and cut management fees across several of its products—moves aimed at capturing the increasing popularity of ETFs.
In July this year the Platinum Group’s long-standing chief executive, Kerr Neilson, will reduce his role to executive director and hand over the top job to co-founder and current chief investment officer Andrew Clifford. Both men carry the DNA of the firm in their blood, suggesting the transition will be effortless.
CHINA
Ping An Asset Management
Ping An Asset Management has made great efforts to expand its business and serve institutional investors other than its parent company Ping An. It is now the biggest insurance asset management firm in China.
Established in 2005 as the asset management arm of insurance giant Ping An, it was one of the first asset managers approved by the now-defunct China Insurance Regulatory Commission. The company had Rmb2.67 trillion ($423.23 billion) in assets under management (AUM) as of the end of June 2017, up 18.1% from the previous year.
The AUM of its third-party asset management business, which come from sovereign wealth funds, pension funds, endowments, insurers, banks and other enterprise customers, is now over Rmb800 billion, ranking first among insurance asset managers.
The asset manager has also evolved into one with a complete research and investment decision system, instead of passively implementing mandates from its parent company. It offers customised products and services to a variety of overseas clients on the basis of diversified models, helping these institutional investors improve their understanding and allocation of the Chinese market, among them a global top five sovereign wealth fund in China.
In 2017, the fund house established 58 new products, further enriching the comprehensive layout of the product line.
CHINA OFFSHORE
Haitong International Asset Management
Haitong International Asset Management is one of the largest mainland asset managers in Hong Kong. It managed HK$66 billion ($8.41 billion) of assets as of end-December 2017, a big jump from HK$5.8 billion five years ago. The company leveraged the network and resources of its parent company Haitong Securities to expand its business in the city.
Through its three entities, the fund house has a comprehensive suite of product offerings, including Hong Kong-authorised funds, ETFs, Mandatory Provident Fund (MPF) offerings, private funds, high-yield bonds and others.
In 2017 alone, Haitong launched 10 new private and public funds. One innovative solution that it created last year was the Haitong Freedom Multi-Tranche Bond Fund, which gathered $1.7 billion in assets in a year and a half, making it one of the largest offshore funds investing in China’s high-yield bond market.
The fund house is also the only mainland asset manager in Hong Kong with registered schemes under the MPF, Hong Kong’s compulsory retirement savings plan. Its Haitong Hong Kong SAR Fund gained a strong investment return of 50% in 2017, compared with the 34.4% on average for the equity funds and beating the 22% on average for the 469 MPF products.
HONG KONG
JP Morgan Asset Management
JP Morgan Asset Management (JPM AM) continued enhancing its investment and advisory services to Hong Kong institutional clients through innovative and thoughtful solutions in 2017.
Risk assets, especially emerging market and Asian equities, saw strong growth last year on the back of accelerated global growth and continuously improving fundamentals. JPM AM products delivered superior performance in such areas, creating considerable value in client portfolios. These include the JP Morgan China Income Fund, which recorded a 30.7% annual return in 2017 and saw its assets under management (AUM) grow more than sixfold from $60.1 million as of end-2016 to $384.3 million as of end-2017.
With global geopolitics heightening market uncertainty in 2017, the fund house also launched the JP Morgan Multi Balanced Fund, targeting those who want to stay invested with a low-volatility solution. The fund has drawn robust inflows in the nine months since its launch, reaching $284 million in size as of end-2017.
In the China-Hong Kong Mutual Recognition of Funds (MRF) space, JPM AM maintained a strong position; its two fund products dominated the total gross sales for all northbound funds. During the year, the fund house also started applying machine learning to the trading process for the investment team, identifying the best possible broker and strategy to execute trading orders.
INDIA
Aditya Birla Sun Life Asset Management
During 2017, Aditya Birla Sun Life Asset Management (ABSL AM) enjoyed some enviable growth in AUM, driven by strong demand for equity schemes and balanced schemes (which are typically a 60:40 mix of equities and bonds). Seven of its equity fund schemes crossed the $1 billion dollar-AUM mark last year, up from just three funds before.
The asset manager’s overall strategy has been very successful, particularly when it comes to targeting retail investors; 3.9 million invest with it. This has helped ABSL AM bring about more balance into its AUM mix; in previous years it had been heavily dependent on institutional clients.
With some key changes in pension fund investment guidelines, provident funds have turned into a new focus area for growth as well as equity sales for the company.
ABSL AM continues to invest heavily in educating investors on the benefits of long-term investing, especially against the robust demand for systematic investment plans, which help investors save a certain amount of money at regular intervals (either weekly, monthly or quarterly).
INDONESIA
PT Manulife Aset Manajemen Indonesia
One of the most interesting facts about Manulife Aset Manajemen Indonesia (MAMI) is that more than half of its 115 employees are millennials. This youthful workforce helps underline the fund house’s determination to understand the needs of the country’s sizeable youth population, and find new ways to gain their interest.
As part of this drive it has supported various technology initiatives. This includes a new digital site, klikMAMI, which lets users open accounts and perform transactions round-the-clock. According to the fund house, klikMAMI generated nearly 7,000 new customers in 2017, and accessed from around 200 locations across the archipelago.
The asset manager has also enhanced its sharia-related capabilities. It launched a new comprehensive unit for the products in 2017, while widening coverage of its education modules to encompass sharia principles, concepts and rules. To cater to growing demand for sharia products, it launched a sukuk (Islamic bond) fund targeted at first-time investors last year.
Overall, the MAMI team has been focused on being innovative, embracing technology and finding alternative ways to engage with customers.
JAPAN
Asset Management One
Ever since it was formed from four other asset management companies in October 2016, a chief preoccupation of Asset Management One has been to demonstrate its ability to offer a stronger array of quality asset-class products.
The company is now Japan’s largest fund house and Asia’s second biggest, boasting an AUM of $504.73 billion as of the end of last year. That was an 11% rise on the year before, and came courtesy of asset price rises and through gaining some new private pension clients.
Asset Management One made some notable strides to underline its strengths in 2017, especially in its equity funds. Standouts included its Growth Core Strategy, which offered over 34% returns in 2017, versus 22.2% from the Topix benchmark. Its Small-Mid Value fund outperformed its Russell Nomura MSV benchmark by 20.8%, and its Japan Equity Mid-Small Cap fund offered 27% outperformance versus its underlying benchmark, while three of its absolute-return strategies posted annual returns in the mid-30s.
Asset Management One has an eye on the future too. It teamed up with Hermes EOS to engage with foreign companies and support five new environmental, social and governance products.
Plus it launched an AI task force and a Financial Innovation Team last year, which are focused on integrating artificial intelligence into quantitative investing. This underpinned two new funds focusing on big data and AI, which have accumulated $600 million in AUM between them.
We published the reasons behind the decisions on other award categories last week. Click on the following links for details: asset service providers, and parts one and two of our asset class award announcements.
Look out for the next part of our Market award descriptions in the coming days.
The award write-ups originally appeared in AsianInvestor's April/May 2018 magazine.