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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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PERFORMANCE

Both the Schroders and UBS funds have consistently performed strongly, beating their benchmarks and peers on a long-term basis, according to Liu.

For example, the funds have both performed 45% on a three-year cumulative period, versus the around 30% return of the MSCI China Index and their peers, FE Fundinfo data shows (pictured above).

Liu noted, however, that there are some differences with their performances short-term.

The Schroders fund is expected to outperform during market rallies, while the UBS AM fund may lag in the same kind of environment. But during down markets, the UBS AM offering is expect to provide better downside protection than the Schroders product.

“The cash policy of the UBS fund helped its performance in 2015 and 2018 when markets were down,” Liu said.

“But when markets start to recover, the UBS fund may lag because it may take some time for the fund manager to adding back equity exposure, as seen in 2020.”

Annual calendar performance

Fund / index / sector	YTD 2021	2020	2019	2018	2017	2016
Schroder ISF China Opportunities A Acc NAV USD in US	1.16	42.92	19.46	-15	44.24	3.11
Index : MSCI China GTR in US	2.78	29.67	23.66	-18.75	54.33	1.11
UBS (Lux) Equity China Opportunity (USD) P Acc in US	-0.94	28.28	41.56	-14.66	59.37	-2.3
Index : MSCI China 10/40 GTR in US	0.44	30.97	22.41	-18.11	49.62	0.65
Sector : HKM Equity China TR in US	-0.45	31.9	27.57	-22.2	37.83	-8.52

Source: FE Fundinfo. In US dollars.

The UBS fund’s downside protection has also made it less volatile than the Schroders fund, Liu added.

Three-year annualized volatility

Fund / index / sector	Volatility
Schroders Fund	22.27
Index: MSCI China	22.44
UBS AM Fund	20.82
Index: MSCI China 10/40	22.33
Sector- China equities	20.39

Source: FE Fundinfo.

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