Thailand is viewed as the “jewel” for Ken Lin (pictured), head of Hong Kong and southeast Asia intermediaries at Invesco.
Multiple asset managers are increasingly putting a lot of focus on southeast Asia, particularly Thailand, to grow their businesses due to a combination of secular tailwinds such as demographics and growing wealth and regulatory developments.
Banks in Thailand are partnering in Europe and are building out platforms that look somewhat similar to their Swiss counterparts. Siam Commercial Bank, for example, has partnered with Julius Baer, while Lombard Odier has a similar tie-up with Kasikornbank.
That is increasingly translating into additional shelf space for international firm, although Lin, who is half-Thai, notes that the market is getting more competitive.
“A perfect example is Thailand, where it’s the jewel from my perspective. They’ve wanted to diversify away from Thai local assets,” he said.
“So, the past 10 years the journey has been giving access to all these new asset classes, new funds to the local markets, which is now getting more and more crowded. It’s getting to the point where it’s more like Hong Kong and Singapore in terms of development.”
Even though thematic funds have hardly been in vogue lately, Lin notes that they resonate with local investors there. He points to the Invesco Global Founders & Owners strategy as being a good example of a strategy which has gained a lot of traction with Thai investors.
The strategy invests in a concentrated portfolio of global equities issued by companies whose management or board contains either company founders and/or individuals with material share ownership.
Southeast Asia
Elsewhere in southeast Asia, Lin notes that whereas Thailand is becoming more saturated as other markets such as Indonesia, Malaysia and the Philippines are ramping up their shelf space so new strategies are appealing to them.
In addition to southeast Asia, Lin has oversight of Hong Kong, Macau and the China QDII channel (Taiwan is covered by another colleague who is based there).
Unsurprisingly, he notes that income is a dominant theme for investors based in Hong Kong.
“It’s really that psychological appeal. There’s something coming in on a consistent basis every month, every quarter. So just having that in the back of the mind and having that consistency and stability of the income that’s coming in, that’s what really appeals to them. It’s the risk adjusted nature of these people in Hong Kong,” he said.
Despite the fact that Hong Kong is more of a saturated market than southeast Asia, Lin still thinks that there are opportunities to expand provided you have the right execution.
“In Hong Kong, it’s very difficult and it’s very mature but the market is huge, so you’ve just got to make sure you have the right execution strategy, the right palatable products that appeal to those investors and you execute with great partnerships. And there’s a strategy we’re trying to execute to do that correctly over the cycles despite the competition,” he said.
