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Market volatility impacts growth, but opportunities are present in various segments
January 2020, Singapore—Despite uncertainties resulting from trade tensions, Asia’s mutual fund industry continued to expand in 2018, albeit at a lower rate compared to the previous year. However, growth potential still exists in various areas.
In 2018, a year in which the U.S.-China trade war loomed large, growth in Asia’s mutual fund assets under management (AUM) fell to a five-year low of 4.2%. As the trade conflict continued into 2019, AUM rose by just 4.6% year-on-year as of September, or 6.0% in the first nine months. China, which accounted for half of the region’s assets, recorded a mere 4.2% increase.
Key trends in the first three quarters of 2019 provide some indication as to where growth opportunities lie. These include:
“Asia’s fund industry is proving resilient despite the various headwinds,” said Ken Yap, Managing Director, Asia, with Cerulli Associates. “Initiatives such as the revision of frameworks for private fund domiciliation and ESG in Hong Kong, commitment to building a fintech hub in Singapore, measures on debt funds in India, and restrictions on trailer-fee hikes in Taiwan demonstrate regulators’ continued efforts to strengthen the asset management industry. While the outlook may be uncertain, good prospects remain in various segments.”
NOTES TO EDITORS:
These findings and more are from The Cerulli Edge—Asia-Pacific Edition, 1Q 2020 issue.
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