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Wells Fargo AM to launch three funds in Singapore

Several other fund managers are also expected to roll-out products in the Lion City.

Wells Fargo Asset Management has lodged an application with the Monetary Authority of Singapore to launch three funds to retail investors. The products, which are domiciled in Luxembourg, are the Wells Fargo (Lux) Worldwide Fund – Global Small Cap Equity Fund, the Small Cap Innovation Fund and the Alternative Risk Premia Fund.

The launch of the three funds are still subject to regulatory approval from the MAS, according to records from the regulator.

The move follows after the firm received a greenlight from Hong Kong’s Securities and Futures Commission (SFC) to launch five products in November. They include three fixed income products, one low volatility equity fund and a long/short equity fund.

FSA sought more information from Wells Fargo AM, but it was not able to provide additional details in time for publication.

The funds that are expected to be launched in Singapore are relatively new. Both the Global Small Cap Equity Fund and the Small Cap Innovation Fund incepted in February, while the Alternative Risk Premia Fund was launched in 2019, according to data from FE Fundinfo. So far, the products are only available to investors in Europe.

Other firms have also filed an application with the MAS this year despite the coronavirus outbreak. They include JP Morgan Asset Management, Pinebridge Investments, Natixis Investment Managers, Manulife Investment Management, HSBC Global Asset Management, and Fidelity.

In Singapore, Wells Fargo AM has 20 mutual funds available to accredited investors and 17 to retail investors. In Hong Kong, it has 15 SFC-authorised products for retail sale, according to FE Fundinfo.

Wells Fargo AM manages $503bn in global assets as of the end of September, according to its website. In Asia, it has offices in Hong Kong, Seoul, Beijing, Shanghai, Singapore, Taipei and Tokyo.

The funds

Wells Fargo AM’s Global Small Cap Equity Fund invests in small-cap companies globally, with a focus on developed markets, according to its prospectus. However, it may invest up to 10% of its assets in emerging markets. It also has the flexibility to invest more than 25% of its assets in any one country, but the whole portfolio should be invested in at least three markets.

The fund is co-managed by Bryant VanCronkhite, James Tringas, Oleg Makhorine and Robert Rifkin, according to FE Fundinfo.

The Small Cap Innovation Fund will also focus on small-cap companies, but with a focus on the US, according to its prospectus. It seeks to identify companies that have the prospect for improving sales and earnings growth rates and enjoy a competitive advantage. It will also invest in companies that are innovative and are able to take market share from competitors.

The fund is co-managed by Christopher Warner and Michael Smith, according to FE Fundinfo.

Meanwhile, the Alternative Risk Premia Fund aims to provide investors with “exposure to sources of excess return known as alternative risk premia (ARP), which result from systemic risks and/or behaviour biases existing within the financial markets”, the prospectus said.

In order to capture ARP, the fund will establish long positions in equities and both “long and short synthetic positions in equities, fixed income, currencies, and on an ancillary basis, in commodities”, it added.

The fund is co-managed by Eddie Cheng, Petros Bocray and Monisha Jayakumar, according to the firm’s website.

The Alternative Risk Premia Fund vs category average since inception

Source: FE Fundinfo. In US dollars. Note: the benchmark ICE BofAML US Treasury Bill (0-3 M) is not available in FE Fundinfo.


Part of Mark Allen.