Head To Head

HEAD-TO-HEAD: Invesco versus Schroders

FSA compares the Invesco Greater China Equity Fund and the Schroder ISF Greater China Fund.

by Francis Nikolai Acosta 21 September 201810 November 2020

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Germaine Share, Morningstar

Introduction

Investors globally have been reducing exposure to equities in Greater China, a region that includes China, Hong Kong, Taiwan and Macau.

“We’ve seen consistent outflows from the asset class for the past few years,” according to Germaine Share, Hong Kong-based associate director for manager research at Morningstar.

However, last year was a strong year for China because internet heavyweights Tencent and Alibaba drove the performance of Chinese equity indices, Share noted.

For the full year 2017, the MSCI China returned 54.33%. However, the index is down -10.38% year-to-date, according to data from FE Analytics.

Following the 2017 performance, Share said that there has been renewed interest in Chinese equities, with asset managers telling Morningstar that more clients have been inquiring about the asset class.

“But unfortunately, since the middle of the year, there has been geopolitical tension, which has sparked a cautious stance from international investors again,” she said, adding that the demand for the asset class has become flat.

Against this backdrop, FSA asked Share to look at two Greater China equity funds: the Invesco Greater China Equity Fund and the Schroders ISF Greater China Fund.

	Invesco	Schroders
Size	$1.2bn	$1.1bn
Inception	1992	2002
Manager	Mike Shiao	Louisa Lo
Three-year return*	51.82%	54.21%
YTD alpha**	13.19	9.21
YTD volatility**	18.22	20.92
Morningstar analyst rating	****	*****
Morningstar star rating	Bronze	Silver
FE Crown fund rating	*****	****
OCF (retail share class)	2.01%	1.86%

Source: Morningstar, FE Analytics.

*Cumulative to 20 September 2018.

**to 20 September 20

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