Manager review
Swan is the head of Asian equities of the fundamental equity division at BlackRock. Besides leading the BlackRock fund, he is also responsible for managing several other regional equity portfolios, setting regional equity investment strategy and developing BlackRock’s Asian investment platform and capabilities.
Zhu is a managing director and head of Chinese equities. She joined the BlackRock team in April 2014. Prior to her time in BlackRock, Zhu was a managing director and head of China equities strategy at Goldman Sachs. At Goldman she was part of the global economics, commodities, telecom and technology teams.
Ng pointed out that while investors may be concerned about Zhu’s relatively short tenure, her first-year performance and her grasp of the Chinese equity market is comforting. Swan and Zhu are both supported by a team of research specialists who are focused on country-specific and macro-economic trends research.
At Allianz, Christina Chung has 23 years of experience managing Asian regional and single country portfolios for both institutional and retail accounts.
She joined Allianz in 1998 and has been a managing director since January 2010. She heads the Greater China team and aside from the China equity fund, she is lead manager for two other China equity funds and one Hong Kong equity fund.
Fee review
The BlackRock fund charges a front-load fee of 5.00%, with ongoing charges of 1.85%, while the Allianz vehicle requires a front-load fee of 5.00% and has ongoing charges of 2.25%.
Ng noted that BlackRock’s charges are in line with the industry average, hence that would not be a deterrent for investors. For the Allianz fund, Ng said that its charges are higher than most competitors. Ng said that economics of scale could be a factor – the BlackRock fund is five times the size of the Allianz fund.
Conclusion
Under a hypothetical investment scenario, Ng said that he would pick the BlackRock fund. He noted that in current volatile conditions, the BlackRock fund should over-perform.
Ng, however, pointed out that investors looking at the BlackRock fund should be aware of the risks. “This is not a fund for investors who are looking for a stable income yield or for those who have a low-risk appetite,” Ng concludes.
Investors who have a longer-term horizon, with capital growth as their focus, should look at the Allianz fund, he added.
“When the climate in China becomes less volatile and equities start trading based on fundamentals, the Allianz fund will outperform.”
