Hong Kong and Singapore have been attracting talent and wealth for some time. These days, they also compete to be amongst the most influential fintech and private banking hubs in the world.
Many international asset managers have tried to tackle these markets but only a few have been successful so far. Deep pockets are needed in markets where commission and initial fund charges are still the norm, and distribution is dominated by local and international banks.
To add to the challenge for asset managers, many local investors trade funds as if they were shares so churn rates are high.
It will take time to change the investing culture of short-term risk taking, but the regulators and the industry are trying. Our research suggests that regular investment plans and discretionary portfolio management will gain traction.
Similar to what we’ve been through in the UK and continental Europe, distribution relationships for asset managers are evolving in the region:
- Platforms – Allfunds and Fund Channel are targeting local banks and insurance firms in Singapore. iFAST is popular with local advisers but many are still very paper-based. That’s an opportunity for different providers to ‘digitise’ the market.
- Vertically integrated firms – St. James’ Place is currently building its partnership model in the region and there is a gap in the market for wealth management outside the banking channel – particularly for expats.
- Stockbrokers – they are becoming full open architecture fund platforms – particularly in Hong Kong.
- Digital wealth managers – asset managers are partnering or investing in the new wave of startups. For example, Schroders has taken a minority stake in B2B and D2C robo WeInvest adding to its longstanding stake in Nutmeg.
Our Asian Fund Distribution research looks at opportunities in Hong Kong, Singapore and Taiwan and will be published in early October. For further information contact: Jeanluc.dejonge@platforum.co.uk.
We are hosting a launch event on 11th October. If you’d like to come along please register your interest here.