The total net asset value (NAV) of foreign investment funds (FIFs), excluding fixed-term funds, hit THB1.1trn ($33.7bn) at 30 June, up 28.8% from the end of 2020, according to Morningstar. The increase was mainly driven by inflows into equity funds, whose NAV rose 40% compared with December 2020, to THB806bn.
Chinese equity funds totalled THB193bn at the mid-point of the year, representing a 61.3% increase versus December 2020, while global equity funds also reported a growth of 55.5% for the first six months in 2021, reaching THB182bn.
“The size of the industry is getting back to the level it was before the pandemic”, said Chayanee Juengmanon, senior research analyst at Morningstar Research.
“The growth was supported by the popularity of foreign investment equity funds. If the growth of equity funds continues, it is likely that the asset class could be the main portion of the Thailand fund industry by the end of this year.”
The total NAV of the Thailand fund industry was THB5.3trn at the end of the second quarter in 2021, up 4.8% from the end of 2020, noted Morningstar. The total NAV of Thailand equity funds was THB1.5trn, a 20% increase from December 2020, narrowing the gap with fixed income to just THB60bn.
Net inflows of THB65bn for the second quarter were supported by short-term bond funds at THB35.2bn, while money market funds continued to lose the most at THB39.3bn.
Domestically, Thailand equity continued to report a net outflow, with the total NAV of Thailand equity funds, excluding long-term equity funds, retirement mutual funds, and super savings funds, decreasing 2.9% quarter-over-quarter to THB232bn.
KAsset continues to lead the Thailand domestic funds industry with a size of THB1trn, or roughly 25% of the market, followed by SCBAM and BBLAM.
Meanwhile, ESG-related funds rocketed an 86.5% compared to that at the end of last year to THB55.8bn, with foreign investment contributing most. In contrast, local investment accounted for 2.7%, or THB1.5bn.
In contrast, property, global bond, and global allocation (or balanced) funds continued to lose popularity among FIFs.
The feeder fund market was valued at THB770bn as of 30 June, increasing 31.5% from December last year, with JPMorgan leading with THB71bn followed by Blackrock at THB62bn. Pimco, the leader at the end of last year, dropped to third place after being the only firm in the top 10 to suffer net outflows as most of its investments are fixed-income funds.
Thailand Fund Flows H1 2021
|Asset class||Net inflow (THB bn)||Asset class||Net outflow (THB bn)|
|China equity||+71.0||Money market||-94.2|
|Global equity||+51.3||Equity large-cap||-24.6|
|Foreign investment bond fix term||+31.6||Global bond||-17.9|
|Foreign investment miscellaneous||+31.4||Property – indirect flexible||-17.7|
|Short term bond||+28.8||Conservative allocation||-12.7|
|Global health care||+21.1||Moderate allocation||-12.5|
|Global sector focus equity||+17.7||Mid/long term bond||-11.7|
|Global technology||+14.4||Global allocation||-9.9|
|Asia Pacific ex-Japan equity||+11.3||Bond fix term||-5.7|
|Europe equity||+10.2||Aggressive allocation||-2.4|