Posted inHead To Head

HEAD-TO-HEAD: BEA Union vs Schroders

FSA compares the BEA Union Hong Kong Growth Fund with the Schroder ISF Hong Kong Equity Fund.
by Fund Selector Asia
Performance

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Over a three-year period, the Schroders fund returned 22.06% compared to the BEA Union fund, which returned 10.82%. Schroders’ product also beat the category average of Hong Kong equity funds available for sale in the SAR, according to FE.

The BEA Union fund does not have a benchmark, while Schroders uses the FTSE AW Hong Kong Index and 10% of HSBC (the index excludes the HSBC stock).

However, both funds underperformed the Hong Kong benchmark Hang Seng Index over three- and five-year periods.

“The BEA Union fund’s short-term changes in relation to macro factors might be behind its relative underperformance, as it will be affected by market noise,” Ng explained.

For example, the fund added some Chinese names after increasing southbound capital flows from the Stock Connect were reported. But before that, the team had little interest in using the trading link, he said.

By comparison, the Schroders fund, due to a strong focus on Hong Kong companies, seems to have missed out on the rally of Chinese stocks from late 2014 until the summer of 2015.

As a result, the fund is less volatile, Ng added.

 3-year annualised volatility
(standard deviation)
 BEA Union Fund  18.56
 Schroders Fund  16.85
 Hang Seng Index  18.07
 Hang Seng China Enterprises Index  23.91
Source: FE

 

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