The FSA Spy market buzz – 6 September 2024
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Share expects the performance of the funds to be similar because both have a quality focus in their investment process.
However, she believes that the First State fund has better downside protection when markets are falling.
“The Schroders fund, because of its quality focus, would also have a downside protection characteristic, but it would be stronger on the First State fund.”
Discreet annual performance (%)
Fund / sector |
YTD 2019 |
2018 | 2017 | 2016 | 2015 |
2014 |
First State Hong Kong Growth I Acc USD in US |
11.18 |
-7.77 | 42.97 | 3.49 | -2.23 |
-4.15 |
Index : MSCI Hong Kong GTR in US |
4.54 |
-7.83 | 36.17 | 2.27 | -0.54 |
5.07 |
Schroder ISF Hong Kong Equity D NAV HKD in US |
8.43 |
-15.11 | 48.89 | -0.56 | -6.13 |
3.15 |
Index : FTSE HongKong GTR in US |
6.51 |
-10.18 | 36.72 | 3.71 | -3.64 |
3.28 |
Sector : HKM Equity Hong Kong TR in US |
4.41 |
-13.52 | 38.52 | -1.53 | -5.95 |
2.8 |
Share explained that benchmark-awareness is one reason why the Schroders fund’s downside protection is not as strong as First State’s.
For example, the Schroders fund was not able to perform as strongly as the First State fund year-to-date.
“Unfortunately, the property stocks that the Schroders fund holds have not done very well this year due to political instability and poor retail sales, which hurt the fund,” she said.
Given that the First State fund has better downside protection, she expects that it is the less volatile of the two. She also noted that First State fund has a better risk/reward profile given its higher Sharpe ratio.
Three-year annualised volatility and Sharpe ratios
Fund / Index |
Volatility |
Sharpe |
First State Hong Kong Growth I Acc USD in US |
16.66 |
0.58 |
Index : MSCI Hong Kong GTR in US |
15.11 |
0.29 |
Schroder ISF Hong Kong Equity D NAV HKD in US |
17.04 |
0.38 |
Index : FTSE HongKong GTR in US |
15.18 |
0.26 |
Sector : HKM Equity Hong Kong TR in US |
15.19 |
0.18 |
Machine learning Chinese investment, BlackRock’s AI patience, Time Magazine’s AI cover, happier staff equal better returns, do wealth managers add value? sexy legs and much more.
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