Alexis Fosler, Allfunds
Fosler, who joined the firm in March to head the Asia business, explained that her firm’s investment advisory and portfolio solutions unit provides services such as due diligence and fund selection.
She told FSA during a recent visit to Hong Kong that the targeted clients are subsidiaries of onshore Chinese firms that have set up in Hong Kong and Singapore. Some have qualified domestic institutional investor (QDII) licences, which allow them to invest onshore money in offshore investments.
Fosler explained that although distributors in the region already have in-house portfolio construction capabilities, some of them lack expertise in all key areas.
“Quite often, what we are asked to do is to come in and support an existing infrastructure. That means to provide additional support to teams that already exist or perhaps expertise in areas that they may not have yet.”
For example, some banks may not have capabilities to benchmark climate change funds to a particular peer group, she said.
Other firms that provide similar services, such as BNP Paribas Group’s Fundquest Advisor, also believe there is increasing demand for portfolio construction services in Asia.
Some private banks and wealth management firms in the region are already outsourcing fund selection in specific areas, such as niche products offered by boutique firms or for funds that have an ESG-orientation, Stéphane Pouchoulin, ex-CEO of Fundquest, told FSA previously.
Fundquest clients are also asking for an ETF buy list because they may have small teams without ETF expertise, said Pouchoulin, who left Fundquest in January and has been replaced by Stéphane Roullin.
Allfunds expects to expand investment advisory capabilities in Singapore and will be hiring staff, according to Fosler, but she did not elaborate. “We are hiring somebody for that team at the moment [in Asia],” she said.
“[Investment advisory] is an area of the business that we will continue to grow, and from a global perspective, it is certainly high on our list of priorities.”
The firm’s investment services team has around 25 people based in Europe, who service clients globally. About 65,000 funds are on its platform, Fosler said.
In 2016, Allfunds set up an Asia office in Singapore, where it has 12 people for other businesses, including fund execution, custody and administration services.