Spy had the most poignant reminder this week that a bad day in one industry is not like a bad day in other industries. Spy had lunch with a portfolio manager from London on Monday who, rather candidly, said one of his funds (he runs two) was having a shocker of a year and was down more than 12% year-to-date, with 3% of that happening in the previous week alone! He was grim-faced and even the bold Aussie red we were quaffing could not assuage his gloomy outlook. “Things are very tough at the moment in emerging markets,” lamented the PM. On Thursday evening, Spy attended a private dinner where the guest speaker was a videographer who has worked for Sky News covering disaster zones for 30 years. His career covered war zones from Afghanistan to Libya to Iraq to Syria, Ebola in West Africa, drug-fuelled gang violence, earthquakes in Indonesia, illegal people smuggling and slave-run cobalt mines in the Congo – and a whole lot more. He has been shot at, bombed, nearly drowned, exposed to horrific diseases and countless other activities that have imperilled his life. Spy was left with a little perspective: a bad day on the markets is just red numbers on a screen.
Spy has been noting the regular comings and goings of wealth managers in Hong Kong for a decade. However, for expatriates, particularly Western ones, the traffic of late seems to be a lot more going than coming. In this there seems a paradox: Hong Kong as a wealth management centre has never been stronger, never had greater assets under advice and management. And yet many feel Hong Kong is simply too expensive a place to do business, even with this golden opportunity of mega wealth creation. This means the big managers get bigger and bigger and the smaller ones must surely merge to survive.
One recent leaver, exemplifying the trend above, is Edward Harris, the former CEO of Holborn Assets and Globaleye in Hong Kong. Spy has discovered that Edward, after a decade in the Fragrant Harbour, has moved to Orlando in Florida. Hong Kong has lost another experienced person who specialised in cross-border pension and wealth management. The sad thing is, will anyone notice?
What is in a logo? Spy is no branding expert but he knows that companies and organisations spend millions creating and promoting their logos hoping the icons will stand for something. The Securities and Futures Commission in Hong Kong has recently made a change to their logo and it now incorporates a rather dramatic eagle. The SFC has made a breathless video, which is on its website, explaining the change. Apparently, despite the success of Hong Kong as a financial centre, the SFC is concerned with wrongdoing in its midst and wants to quickly spot and punish the naughty ones. Thus the eagle. But the regulator also wants the public to know it goes beyond symbols. In a new online initiative, anyone can now report corporate fraud and market misconduct via the SFC website. Still more: A section titled Have you seen these people? “now provides more details about key suspects the SFC is trying to locate as well as an online form which can be used to submit information about the whereabouts of these individuals”. As the video dramatically states: “Times like these call for unceasing vigilance.” The strap line sounds to Spy like a line from Harry Potter when Professor Moody, Harry’s lunatic Defence of the Dark Arts teacher says something almost identical – if Spy’s alcohol-sodden memory can be trusted.
Timing is everything with a fund launch. Pity Franklin Templeton, which has recently launched a series of new geography-specific ETFs: South Africa, Latin America and Saudi Arabia. Just after the launch of the Saudi Arabia ETF, the Saudi government was publicly accused of blatantly and brutally executing Washington Post columnist Jamal Khashoggi, Saudi Arabia is firmly in the naughty corner until it comes up with a suitable explanation. Spy is not too sure that the Saudi fund is going to be flavour of the month for a while. Spy, for one, is particularly pleased that leading companies such as Blackrock and JP Morgan have decided their chief executives are going to skip the Saudi Future Investment Initiative next week. At times, our industry must speak up.
It would be a surprise if most wealth managers and private bankers in Asia had not seen the recent name change of Old Mutual Global Investors to Merian Global Investors. Merian has telegraphed the change well as it has become an independent company from its former owner, Old Mutual Plc. Spy rather liked the inspiration behind their new name: Maria Sibylla Merian.
Maria was a pioneering scientist, adventurer and artist in an era when this was all too rare. Her story is fascinating and worth delving into. Hat tip to the Merian team for putting a woman at the heart of their new brand.
With the news that Invesco is buying Oppenheimer Funds this week, Spy is wondering where the next bit of consolidation is going to come from. Answers on a postcard, please.
More advertising has been spotted this week. First up is Aberdeen Standard with a corporate campaign about finding connections. Perhaps Spy has been spending too much time looking at financial campaigns…but a strange thing happened when he looked at this one. The first connection that came to mind was not a group of people but rather (British) Prudential’s logo. Or has Spy been drinking too much Chateau Lafite?
Next up is a campaign on busses for the new iFund platform that is trying to revolutionise fund distribution in Hong Kong with its low fees. iFund will need to do all it can to change buying behaviour in a city where there is no regulatory zeal to lower fund fees.
Until next week…
