Asia's top fund houses by market, explained part 1

AsianInvestor explains how the judging panel selected the winners for Australia/New Zealand, Singapore, China, Hong Kong, India and Indonesia.
Asia's top fund houses by market, explained part 1

AsianInvestor’s industry-leading Asset Management Awards are widely tracked by asset managers and asset service providers with a presence in Asia Pacific.

While the awards process has evolved through the years, the awards remain laser-focused on picking the brightest and best stars in the region's asset management industry.

Our judging panel, comprising independent industry veterans and top executives from asset owners across the region, assessed all qualified entries and took the lead in providing valuable insights and guidance on shortlisting the best candidates.

The final entries were assessed by the editorial team to eventually decide on the ultimate winners.

Today, we explain the rationale behind the selection of some of the winners of the market awards. We showcase the winners for Australia/New Zealand, Singapore, China, Hong Kong, India and Indonesia.

AsianInvestor would like to take this opportunity to also say a big thank you to all the contestants. We were gratified to see the surge in entries this year – our highest since 2018.

We would like to extend our deep gratitude to all our judges for their efforts and assessments of the entries. Their insights were invaluable in deciding the final winners across categories.

Australia/New Zealand and Singapore: J.P. Morgan

J.P. Morgan Asset Management (JPMAM) made significant strides in 2023 in growing the business in Australia and New Zealand. 

With a strong pedigree in managing real estate and timberland assets for its global clients, in 2022 JPMAM launched a range of active ETFs on the Australian Securities Exchange (ASX): a business stream that has become a strong area of focus for the firm.

“JP Morgan again leveraged its global network and showed a lot of innovation,” judges said of this submission. “They are very creative in what they do.”

This journey kicked off with the listing of the JPMorgan Global Research Enhanced Index Equity Active ETF (JREG) and JPMorgan Equity Premium Income Active ETF (JEPI) on the ASX.

Two others have followed in short measure.

“Active ETF solutions like JEPI provides access to innovative strategies that can help generate attractive income and capture a significant portion of S&P 500 returns with meaningfully lower volatility,” JPMAM said in its submission material.

The product has so far been remarkably successful, providing an attractive 12-month rolling dividend yield of 8.50%.

Judges were particularly interested in JPMAM’s efforts to expand alternatives beyond simply institutional clients. In December 2023, it announced a partnership with alternative investment platform iCapital, as it sought to make alternative solutions available to wholesale investors in Australia.

Under the collaboration, the New York-based financial technology firm will provide its proprietary technology platform to facilitate the distribution of JPMAM’s select global alternative strategies, enabling Australian investors to explore a broader range of investment opportunities in the alternative space.

In Singapore, meanwhile, judges said they had little hesitation in handing JPMAM a coveted market award.

“Very impressive performance and credentials in 2023 which seemed to outshine all the competition,” judges said of this stand out submission.

Innovation has been key in this Asian market and among JPMAM's various initiatives, one noteworthy development was a tie-up with DBS to launch a retirement product that adapts to a customer’s life stages, automatically calibrating asset allocation depending on an individual’s timeline. 

China: China Asset Management

Investors in China have poured billions into exchange-traded funds (ETFs) this year — at the fastest pace on record — amid a market slowdown that has put active investing on the backseat.

Driving these changes has been ChinaAMC, which holds the biggest market share in ETF products. Overall, China raked in more than 400 billion yuan ($55.97 billion) this year setting a record for annual net inflows.

China AMC seeks to emulate global ETF giants such as Vanguard and BlackRock iShares and judges were impressed by its business growth, as it launched no fewer than 61 funds in 2023.

“Their business growth was strong as was innovation,” judges said.

ChinaAMC introduced several new ETFs catering to different segments of the market, including small and medium-cap, mid-cap, and large-cap ETFs.

These ETFs covered various indices such as the Science and Technology Innovation Board, ChiNext Mid-Cap 200 Index, and CSI 2000 Index, providing investors with diversified investment options.

ChinaAMC introduced the CSI All Index Medical Device ETF, targeting the medical device tertiary industry.

In terms of passive funds, ChinaAMC CSI Green Power ETF was launched against the backdrop of strong policy support for the green power industry, investing in the field of photovoltaic power generation, wind power, and hydropower.

Again, judges were impressed by ChinaAMC’s ability to ride trends, in this case providing investor profit from the decarbonisation of the Chinese power sector and the green transformation of traditional high-carbon industries.

Hong Kong: Fidelity

There was little doubt with this submission how important Hong Kong is for Fidelity.

As one of its first international offices, the city continues to be its regional headquarters and is an increasingly global centre for Fidelity, as it boasts more than 400 professionals based in Hong Kong.

As the second-largest investment hub globally after London, the Greater Bay Area (GBA) initiative continues to grow in scope and significance for Fidelity’s business as it drives business with stocks, bonds, multi-asset and sustainable investing.

“This submission gained points for innovation,” judges said.

With the aim of strengthening its distribution network beyond traditional banking and insurance channels through digital platform partnerships, Fidelity used trading platform FUTU to onboard a customised advisory Fund of Funds (FOF) model portfolio, distributed through its Hong Kong platform.

The FOF multi asset model portfolio – The Next Gen Multi Asset Thematic Fund – uses seven of its multi-asset funds as building blocks.

With the GBA Wealth Management Connect Scheme continuing to develop, it broadened its Hong Kong-domiciled fund range to provide investors greater options seeking diversified solutions, launching three new global target funds in 2023.

In terms of sustainable funds, it offered three Article 9 funds – the highest sustainability classification under Europe’s Sustainable Finance Disclosure Regulation (SFDR).

In an uncertain and volatile year, it assets under management (AUM) increased 17% year-on-year to $776.2 billion (as of 31 December 2023), and AUM for its Sustainable Fund Family (SFF) expanded to $35.2 billion (as of 30 September 2023) up 3% from calendar 2022.

India: Edelweiss

Edelweiss Alternatives - one of India’s largest players in private credit - posted commendable returns in 2023, increasing its assets under management from $5.4 billion in 2022 to stand at around $6.3 billion now.

Keeping its eye on large-scale, scalable investment opportunities in private debt and real assets in India, Edelweiss is driving significant value across diverse sectors.

“Edelweiss did a very good job; they’re introducing private credit in India,” judges said of this submission.

The firm has recognised the need in India for the kind of flexibility offered by the private credit market. Some estimates suggest the entire sector could grow to as much $100 billion over the next decade from its current $15 billion.

In many respects, with the private credit market representing just 0.5% of India’s GDP compared with 3-4% for developed markets, Edelweiss has the advantage of working with a blank slate.

To this end, it introduced its Core Credit Plus Fund (C-SIP), which is aimed at delivering bespoke credit solutions to portfolio companies.

Another notable fund in 2023 was its Commercial Real Estate Fund (RYP), focusing on office buildings with significant potential for value enhancement through operational and financial efficiencies.

Looking ahead, the firm aims to broaden its reach within the Indian Institutional client base as well as exploring new horizons in geographies such as Australia, Japan, Korea, and the Middle East.

“Diversifying our client segments remains a cornerstone of our strategic roadmap, ensuring sustained growth and resilience amidst an ever-evolving market landscape,” Edelweiss states in its submission.

Indonesia: UOB Asset Management

Despite a challenging market, UOB Asset Management (UOBAM) Indonesia managed to steadily increase its assets under management throughout the year. As of September 2023, its AUM increased by 44% year-to-date and revenue went up sharply by 77% from 2022.

“This was a consistently strong performance with a strong emphasis on innovation,” judges said. “A lot of these funds are trying to get up to speed with ESG and combining it with Shariah.

“This is a tough space where they are really trying to redefine what ESG means.”

With plans to launch more ESG and Sharia-based products in 2024, UOBAM Indonesia aims to capitalise on this growing space. The total offshore Sharia AUM in Indonesia as per October 2023 was $770 million, contributing 2% of the total mutual fund AUM in the industry.

Innovation from an ESG perspective was strong.

Leveraging local and regional ESG expertise and machine learning, UOBAM Indonesia has established the first actively managed equity fund with a philanthropy feature in Indonesia - UOBAM Sustainable Equity Indonesia (USEIN).

The fund is equipped with an in-house ESG rating model that reviews the portfolio constituent universe from a prominent ESG angle, and enables investors and investment managers the opportunity to donate part of the funds should they wish.

Apart from USEIN, it also has an ESG-based money market mutual fund - UOBAM ESG Pasar Uang Indonesia (UPINDO) – which has been part of UOB’s stellar growth in the sector.

More work, meanwhile, is being put into ESG and Islamic principles research.

UOBAM Indonesia is currently collaborating with UOBAM Malaysia, UOBAM Brunei, and Malaya University on a research paper to determine the effects of ESG and Islamic principles on financial performance with the aim of implementing those insights.

The paper is expected to be published in 2024-2025.

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