Against a backdrop of sovereign debt crisis and post crisis issues, concerns over inflation and rising interest rates seem par for the course. Indeed, in terms of asset allocation, according to Tim Gardener, global head of consultant relations at AXA Investment Managers, fund managers around the globe are focussing their efforts towards providing inflationary protection by taking duration out of fixed income products.
Category :Asia,Australia,Hong Kong,Malaysia,Philippines,Global,Europe,U.S.A.,Africa
David Hoffman, co-lead portfolio manager of global fixed income portfolios and a managing director at Brandywine Global, discusses the impact of the recent financial crisis on global sovereign debt investing. The firm, which manages US$32 billion, celebrates its 25th year anniversary in 2011.
INDEXING IN ASIA
Category :Asia,Australia,China,Hong Kong,Japan,Korea,Singapore,Taiwan,U.S.A.,Asia-Pacific
Index providers have been focussing more on customisation and product differentiation following the global financial crisis (GFC), especially when it comes to creating product mixes for the Asian markets. There appears to be plenty of scope for development amongst Asia’s index families in view of the region’s booming economies, increasing awareness of risk control, as well as a dramatic rise in the use of exchange traded funds (ETFs).
Category :Asia,China,Hong Kong,Global,U.S.A.
While recent investor interest has been focussed on the offshore RMB (CNH) or Dim Sum bond market, the investment value of HK$ bonds should not be understated. “We certainly believe that the HK$ bond market will continue to retain its appeal to institutional and retail investors,” says Cecilia Chan, the chief investment officer of fixed income, Asia-Pacific at HSBC Global Asset Management.
Category :Global,U.S.A.,United Kingdom
Inflation and recession are the Scylla and Charybdis of investing. If one isn’t the major source of worry, the other is except when both prey on investors’ fears. Since we are finally putting the Great Recession of 2007-2009 behind us, many feel it is now time to worry about inflation. Whether or not major economies are about to face increasing inflation, it never hurts to devote a little time to considering what an investor can do to moderate the impact of rising prices. The place to begin is to understand what inflation means.
Category :Asia,Japan,U.S.A.,United Kingdom,Asia-Pacific
Investors seeking beta often use “index” and “ETF” terms interchangeably. An explanation of the advantages and disadvantages of different options in obtaining index exposure or beta might assist in making a more knowledgeable decision. Institutional investors have four main options when looking to obtain index exposure.
Just a generation ago, South Korea and Taiwan were emerging market economies with stock markets into which only the bravest investors would venture. Today, after decades of growth  – coupled with stable, trustworthy financial markets – South Korea and Taiwan are resounding economic success stories.
ASSET MANAGEMENT IN THE MENA REGION
Category :Middle East,Qatar,Kuwait,Asia-Pacific,Africa
Seldom is the underdevelopment of capital markets a positive thing. However, in the case of the Middle East and North Africa (MENA) region, the lack of stock exchanges in several flashpoint countries may well turn out to be a blessing in disguise. Syria, Libya and Yemen, the scene of ongoing unrest, do not have functioning stock exchanges.
Category :Asia,China,Hong Kong,Japan,Korea,Malaysia,Philippines,Singapore,Thailand,U.S.A.,Brunei
The liberalisation of the yuan is opening up a host of new opportunities in centres such as Hong Kong and Singapore; from trade finance to investments, settlement volumes in yuan are growing by the day. Brunei, too, is keen to tap into these opportunities. One example could be to issue sukuks (Islamic bonds) in Brunei denominated in yuan, says a senior Brunei official.
Category :India,Asia,China,Indonesia,Malaysia,Middle East,Vietnam,Southeast Asia,Europe,U.S.A.,Brunei
Southeast Asia is not always the first market to spring to mind as a venue for private equity investing, with its highly fragmented character, and great disparities in levels of wealth and development. Brunei exemplifies both characteristics of the region – an isolated constitutional sultanate on the north coast of the island of Borneo, which it shares with territories of Malaysia and Indonesia, boasting the world’s fifth highest GDP per capita, according to IMF 2010 figures, despite being surrounded by Malaysia’s poorest state. All the more interesting, then, to see what private equity investors at Asia Asset Management’s 7th Brunei Roundtable made of the sultanate as a platform for investing locally and regionally.
Category :Asia,China,Indonesia,Vietnam,Southeast Asia,U.S.A.,Brunei,Asia-Pacific
The issue of where and how to invest in Asia has come very much to the forefront with the region’s sudden upsurge in popularity among private equity (PE) investors immediately prior to the GFC, and its even more persuasive buoyancy post the crisis. No one doubts the macro attractions, but where and how – and with who – to translate these broad themes into on-the-ground above-market returns has always been the challenge for this illiquid asset class. Leading regional fund managers and investors at the private equity panel at Asia Asset Management’s 7th Brunei Roundtable gave their approaches to an answer for their host country, Southeast Asia, and other Asia-Pacific markets.
Plan sponsors and asset owners in Asia have started to broaden their investment universe into more specialist and regional themes to capture the new growth opportunities. “We are already seeing investors moving into more narrowly defined areas such as real estate in both the listed and unlisted space,” says Jim McCaughan, the chief executive officer at Principal Global Investors (PGI). Other targetted investments have included high yield and emerging markets in Asia, reflecting the changing investor appetite from the pre-crisis period.
Among the many lessons that the industry learned as a result of the global financial crisis, is that the global financial community is highly interconnected and becoming more so every day. To grow and compete in today’s global marketplace, firms are not only looking to gain a leading position in their home country, but also looking to establish themselves as leaders in other world markets. They may be considering one of a handful of potential strategies to achieve this goal; from simply investing in foreign markets, to establishing a physical presence offshore either directly or through strategic partnerships. Of course, with high rates of economic growth and new opportunities for investment, Asia is front and centre in the drive for global expansion. This holds true for many Western firms looking to invest in emerging markets as well as Asian providers focussed on building up their presence and scale.
Forty years ago, cold warrior Richard Nixon made a volte face in US foreign policy. The American president sent his national security advisor Henry Kissinger to pursue a secret dialogue with communist China. Three years later Nixon resigned in disgrace over the Watergate scandal but his wily assistant has continued to profit enormously from that venture – although at the beginning he had labelled it privately as Nixon’s “flight of fantasy”.
Category :Asia,China,Indonesia,Japan,Korea,Malaysia,Middle East,Taiwan,Thailand,Europe,U.S.A.,United Kingdom,Kuwait,Asia-Pacific
Selected CIO’s from leading asset management firms operating in the Asia-Pacific region give their views in regard to where the various markets are headed.