Malaysia’s fund management industry assets shrank 0.2% in September, the first monthly decline in six months as foreign investors pulled out of most asset classes.
The industry had 811.93 billion ringgit (US$195.38 billion) of total assets under management as at September 30, down from 813.58 billion ringgit at the end of August, according to latest data posted on the website of Securities Commission Malaysia.
The regulator typically publishes the data without providing analysis. Assets were up 9.19% from 743.58 billion ringgit at the end of 2018.
There was an outflow of foreign portfolio capital in September on worries that the trade conflict between the world’s largest and second largest economies could worsen, according to a fund manager at a European insurance company in Kuala Lumpur.
"Foreign investors' flight to safety was mainly driven by concerns of the possible escalation of tension between US and China," he tells Asia Asset Management, speaking on condition of anonymity.
Stock funds fell 0.45% to 382.32 billion ringgit, bond funds dropped 0.61% to 179.69 billion ringgit, and money market funds, which invest in treasury bills, commercial papers and other short-term debt, declined 0.9% to 162.54 billion ringgit.
Assets of private equity and unlisted stocks fell 0.56% to 14.07 billion ringgit.
Feeder funds, which invest in other investment funds, bucked the trend, rising 2.14% to 32.41 billion ringgit.