Equity and bond funds continue to dominate the industry, accounting for 46% and 34% of total assets, respectively, the report shows. They two asset classes also dominate in number, with 1,018 equity funds and 430 bond funds out of the 2,203 SFC-authorised funds.
However, bond fund assets to the end of March 2017 increased by $41.5bn, while equity fund assets were up by $30bn.
Hedge funds lost the most, declining 75% to $28m.
|
|
Assets under management |
|
|
|
Fund type |
31 March 2017 in $bn |
31 March 2016 in $bn |
% change |
|
Bond |
465.27 |
423.76 |
10% |
|
Equity |
638.85 |
608.78 |
5% |
|
Diversified |
137.45 |
117.24 |
17% |
|
Money market |
21.01 |
21.32 |
-1% |
|
Fund of funds |
19.87 |
15.65 |
27% |
|
Index |
92.07 |
87.53 |
5% |
|
Guaranteed |
130m |
70m |
84% |
|
Hedge |
30m |
110m |
-75% |
|
Other specialised |
1.29 |
1.58 |
-18% |
|
Total |
1.38trn |
1.28trn |
8% |
Source: Securities and Futures Commission
Consistent with data coming from Hong Kong Investment Funds Association (HKIFA), gross sales for bond funds were higher than equity funds during the full year of 2016 and the first quarter of 2017.
Gross sales for bond funds accounted for 51.5% (2016) and 39.9% (2017) of total fund sales. Equity fund sales were only 26%-27% for both periods. It is in sharp contrast from 2015, when equity funds accounted for 60.7% of all fund sales.
During the first nine months of 2016, Hong Kong saw strong inflows in bond funds during the first nine months, FSA reported earlier.
More HK domicile funds
The number and assets of Hong Kong-domiciled funds increased year-on-year ending 31 March, according to the SFC report. The number of funds increased to 735 from 656, while assets increased by 11% to $131.6bn.
However, market share of Hong Kong-domiciled assets remains low – at around 10%. Luxembourg-domiciled funds continue to dominate the industry, accounting for 66% of total assets.
|
|
Assets under management |
|
|
|
Mutual funds by origin |
31 March 2017 in $bn |
31 March 2016 in $bn |
% change |
|
Hong Kong |
131.61 |
118.17 |
11% |
|
Luxembourg |
910.35 |
860.62 |
6% |
|
Ireland |
172.38 |
150.27 |
15% |
|
United Kingdom |
90.99 |
78.83 |
15% |
|
Mainland China |
17.06 |
10.88 |
57% |
|
Bermuda |
220m |
290m |
-26% |
|
Cayman Islands |
11.55 |
15.25 |
-24% |
|
Others |
41.82 |
41.72 |
0% |
|
Total |
1.38trn |
1.28trn |
8% |
Source: Securities and Futures Commission
Ucits funds account for around 65% of the combined AUM of funds in Hong Kong, Singapore and Taiwan, according to data from BNP Paribas Securities Services.
But local fund structures are expected to outpace Ucits, Daniel Caleghin, head of wealth management strategy for Asia-Pacific at Deloitte subsidiary Casey Quirk, said recently.
Citing data from a Casey Quirk study, he said that in 2015, 76% of the region’s $6trn industry were in local fund structures versus 14% in Ucits.
However, the figures are distorted by China, as Ucits are not allowed to be distributed in the mainland.
Caleghin expects that total AUM in Asia’s fund industry will hit $11trn by 2020, with 79% of those assets in local fund structures.
