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BMO, Jupiter, Schroders plan HK funds

BMO Global will launch an actively-managed fund that invests in passive products, while the regulator approved for launch other funds from Jupiter and Schroders.

BMO Global received a green light at the end of May from the regulator to offer its BMO Balanced Fund to investors, according to records from the Securities and Futures Commission.

The fund will invest primarily in global ETFs, which may or may not be authorised by the SFC, according to the fund’s key fact statement.

Around 40%-80% of the fund will be in equity ETFs and 20%-60% in fixed income ETFs.

It is the Canadian firm’s first Hong Kong-domiciled actively-managed fund. The firm manages Hong Kong-domiciled exchange-traded funds, according to data from the Hong Kong Exchange.

It first launched three ETFs in the 2014 and rolled out another batch of four in 2016:

Source: Hong Kong Exchange. In US dollars.

At the end of 2017, the firm was the seventh largest ETF manager in Hong Kong, according to data from Broadridge Financial.

BMO has chosen Hong Kong as the place to focus their Asian expansion efforts, Mark Raes, Toronto-based head of product at BMO Exchange Traded Funds, told FSA in October last year.

One of the reasons is the potential opportunity to sell their products to mainland Chinese investors through the China-Hong Kong ETF Connect scheme, which is expected to roll out as early as the end of this year.

Earlier, the firm announced plans to move into the fund-of-funds space in China by embedding its ETF products into funds managed by its strategic partner, ICBC.

A unit of BMO also has a 28% stake in a joint venture with mainland asset manager Fullgoal Fund Management.

Globally, BMO manages $260bn in assets and has offices in Chicago, Toronto, London and Hong Kong, according to the firm.

Other firms that are expected to launch products soon include Jupiter Asset Management and Schroders.

Jupiter’s Global Emerging Markets Short Duration Bond Fund received a go signal from the regulator this month, while the Schroder Global Target Return Fund received regulatory approval last month.

The Jupiter fund was made available to accredited investors in Singapore in May this year, while the Schroders fund has been available to both retail and accredited investors in the Lion city since 2016, according to data from FE Analytics.

Part of the Bonhill Group.