One important driver of fund houses’ asset growth last year in Asia were passively managed investments, both traditional index mandates and exchange-traded funds.
This trend helped contribute to a notable rise by both China Southern and Deutsche Asset & Wealth Management up AsianInvestor’s top 100 ranking of fund managers by AUM sourced from Asia Pacific* (see table below). (Indeed, we predict that appetite for passive assets will continue to accelerate in the coming year for a number of reasons, as set out in the latest February issue of the magazine.)
China Southern – which, aside from Tianhong Asset Management, saw the biggest growth among mainland fund houses – drew $2.5 billion and $500 million of net inflows into its equity and fixed income ETFs, respectively. It runs about 30% of the total $10.45 billion AUM in RQFII ETFs, said Jack Wang, head of sales at CSOP Asset Management, China Southern’s Hong Kong joint venture.
Asked whether he saw the new Shanghai-Hong Kong Stock Connect scheme luring money away from Chinese funds, Wang said the trading link was simply another way to access the market. “We don’t see people moving away from ETFs or active funds because of Stock Connect. And even if you lose some market share, the overall pie is going to get a lot bigger.”
Wang also sees more foreign institutional investors putting money into China this year. He said he was getting more inquiries than ever from overseas asset managers, sovereign wealth funds and pensions about accessing mainland securities.
Meanwhile, Deutsche AWM posted a notable 42.77% rise in Asia-Pacific AUM. A big contributor to this was Japanese demand for alternative real assets, said Ken Tam, Asia-Pacific head of the global client group. He also cited strong growth across the firm’s traditional, passive and alternative products throughout the region.
Looking ahead, Tam is optimistic about the prospects for the Hong Kong-China mutual recognition scheme, citing the lack of overseas diversification among the huge mainland investor base. Deutsche AWM does not have any Hong Kong-domiciled funds, he noted, but they are under consideration.
Tam sees his biggest challenge ahead as keeping staff happy in terms of job satisfaction and career development, given the fierce competition for talent in Asia.
|The top 100 fund houses by AUM from Asia Pacific: numbers 26-50|
|26||-||Tianhong Asset Management||Asia-based||88.3||10.9||708.88%||88.3||10.9|
|28||25||Goldman Sachs Asset Management||Global firm||86.0||79.0||8.86%||1150.0||949.0|
|29||27||Wellington Management||Global firm||80.3||70.9||13.22%||892.4||798.9|
|30||37||Deutsche Asset Management||Global firm||72.3||50.7||42.77%||1205.6||934.7|
|31||33||Manulife Asset Management||Global firm||67.6||59.1||14.38%||275.7||257.8|
|32||28||Nissay Asset Management||Japan-based||64.2*||65.2||-1.50%||65.2||65.2|
|33||29||Northern Trust Asset Management||Global firm||63.6||64.4||-1.24%||923.3||846.2|
|34||31||Western Asset Management||Global firm||61.4||61.0||0.57%||471.6||442.7|
|35||41||Harvest Fund Management||Asia-based||60.7||46.3||30.86%||66.9||49.2|
|36||34||BNP Paribas Investment Partners||Global firm||57.5||56.0||2.73%||641.3||640.2|
|38||36||Mirae Asset Global Investments||Asia-based||57.0||54.0||5.51%||62.2||57.9|
|39||30||Tokio Marine Asset Management||Japan-based||56.9||62.4||-8.81%||57.4||63.0|
|40||32||China Asset Management||Asia-based||56.1||60.7||-7.65%||56.1||60.7|
|41||52||China Southern Asset Management||Asia-based||54.4||36.7||48.07%||54.4||36.7|
|42||44||Allianz Global Investors (including RCM)||Global firm||53.9*||43.5||24.00%||510.6||408.5|
|43||39||Hanwha Asset Management||Asia-based||53.4||47.8||11.79%||60.3||47.8|
|44||40||MFS Investment Management||Global firm||50.8||46.7||8.92%||424.1||385.3|
|45||46||Morgan Stanley Investment Management||Global firm||47.3||41.8||13.00%||397.8||359.7|
|46||43||Credit Suisse||Global firm||44.9*||43.7||2.84%||425.2||410.1|
|47||50||Natixis Global Asset Management||Global firm||42.6||37.2||14.52%||894.3||838.2|
|48||45||Meiji Yasuda Asset Management||Japan-based||42.3*||42.5||-0.26%||42.3*||43.0|