October 2020
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October 2020
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Malaysia’s fund industry assets up 2.54% in January-July on bond gains

The Malaysian asset management industry had 844.07 billion ringgit (US$202.55 billion)  of total assets under management at the end of July, up from 823.19 billion ringgit on December 31, 2019
By Goh Thean Eu   
September 25, 2020

Malaysia’s fund management industry assets rose 2.54% in January through July, as foreign investors fled emerging-market stocks and sought safe haven assets, including bonds, in the wake of the coronavirus pandemic.

The industry’s total assets under management as of end-July was 844.07 billion ringgit (US$202.55 billion), up from 823.19 billion ringgit at the end of 2019, according to latest figures published on the website of Securities Commission Malaysia. Assets were up 4.5% from 807.69 billion ringgit in June.

The regulator typically posts the data without providing analysis.

Bond fund assets jumped 12.12% to 203.65 billion ringgit between January and July. Assets of stock funds fell 2.20% to 391.34 billion ringgit in spite of a 5.45% month-on-month gain in July.

The decline in stocks over the seven-month period was mainly driven by foreign investors cutting their exposure to emerging markets to move into safe haven assets amid the pandemic, according to a fund manager at a Malaysian fund management company.

“Even though Malaysia’s stock market was up by about 1% during the first seven months, the overall [equities] industry AUM fell as we have many funds that have exposure to other emerging markets, including Indonesia and Thailand stocks, which suffered badly during the pandemic,” the Kuala Lumpur-based manager tells Asia Asset Management, speaking on condition of anonymity.

Bond fund assets were up 3.16% month-on-month in July.

Assets of fund of funds jumped 14.89% to 41.12 billion ringgit over the seven months, and rose 7.03% in July.