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Hong Kong funds sales in 2014

Last year, Hong Kong's fund industry had a 21% increase in net sales, led by inflows into European and Asian equity funds, according to the Hong Kong Investment Funds Association.

The industry body attributed the steady growth in sales to the low interest rate environment and abundant liquidity. 

December was the only month in 2014 that the industry had net outflows, and they hit $1.1bn.

Despite that, fund houses managed to end 2014 with 21.4% growth in net sales to $12.5bn.

Gross fund sales during the period increased by 9.3% to $77.7bn.

Bruno Lee, chairman of HKIFA, said the association is positive on the outlook for 2015 due to the low interest rate environment and the global economic recovery.

However, he added: “Retail investors should review their portfolio regularly and should pay more attention to the uncertainty and potential risk related to the slowdown and structural change in composition of mainland China’s growth rate, the timing of [the expected US] interest rate increase, the volatility in oil and commodity prices and geopolitical risk.” 

Equities lead gainers

In 2014, equity funds regained the leading position in gross sales. 

Equity funds took up 46.7% of the industry’s gross inflows for the full year, exceeding both bond funds and balanced funds, with each accounting for about 25% of the industry total.

This reversed the trend in the previous three years, when bond funds garnered the lion’s share of the industry’s gross inflows.

Gross sales of equity funds reached $36.3bn in 2014, 59% higher than that of 2013.

Looking at net inflows, equity funds were able to attract $6.9bn, up 50% year-on-year and accounting for just over half of the industry total.

Eight out of the 16 equity fund categories registered net inflows. European regional equity funds led with net inflows of $2.7bn. This was followed by Asia regional (ex-Japan) equity funds, which managed to pull in close to $2.2bn.

On the other hand, Asian single market equity funds recorded $257m in net outflows.  

Emerging equity markets continued to be out of favor, with the three emerging market categories (global, Eastern Europe and Latin America) showing net outflows. In total, these funds recorded aggregate net outflows of $492m, though less than in 2013 when outflows amounted to $728m.

Bond funds

Even as bond funds registered gross outflows in 2014, they managed to attract inflows on a net basis. 

Bond funds had net inflows of $541m, reversing the trend of net outflows that were recorded in 2013.

This was on the back of strong inflows into Asian bond categories, which managed to pull in close to $1.7bn of new money.

European and high yield bond funds also helped to balance off the huge net outflows of global bond funds.

Balanced funds net inflows dropped 45% to $5.2bn.


Part of the Mark Allen Group.