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HEAD-TO-HEAD: Schroders versus UBS AM

FSA compares two China equity products: The Schroder ISF China Opportunities Fund and the UBS (Lux) Equity Fund – China Opportunity Fund.

by Francis Nikolai Acosta 9 April 20219 April 2021

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Louise Liu, Oreana Financial Services

INTRODUCTION

With China being one of the first countries to contain the pandemic, Chinese equities became one of the best-performing asset classes last year.

The MSCI China returned 29.67% for the full year 2020, which compares with the 16.82% return of the MSCI All Country World Index.

However, with the rest of the world catching up on the back of the vaccine rollout, returns in the China equity market have become muted, returning only 0.9% on a year-to-date basis.

Louise Liu, investment strategist at Oreana Financial Services, continues to believe that Chinese equities should provide investors with long-term investment opportunities.

“China has a massive domestic consumer base, which is the real driver of the economy,” she said.

“We remain positive on the asset class, and we don’t see we are lowering our allocation to the asset class any time soon,” she said.

Against this backdrop, FSA asked Liu to compare two China equity funds, and she chose the Schroder ISF China Opportunities Fund and the UBS (Lux) Equity Fund – China Opportunities Fund.

	Schroders	UBS AM
Size	$1.76bn	$15.3bn
Inception	2006	1996
Manager	Louisa Lo	Bin Shi, Denise Cheung, Morris Wu
Three-year cumulative return	45.85%	44.23%
Three-year annualised return	13.41%	13.35%
Three-year annualised alpha	3.78	4.46
Three-year annualised volatility	22.27	20.82
Morningstar analyst rating	Gold	Silver
Morningstar star rating	****	*****
FE Crown fund rating	****	*****
OCF	1.84%	2.40%
Benchmark	MSCI China	MSCI China 10/40

Source: FE Fundinfo, Morningstar Direct

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