Malaysia’s exchange-traded fund (ETF) industry assets fell 10.76% in the first half of 2021 on the back of declines in stock and bond funds.
Total ETF assets as of June 30 was 1.99 billion ringgit (US$469.58 million), down from 2.23 billion ringgit at the end of 2020, according to data published on the website of Securities Commission Malaysia. The regulator typically posts the data without providing analysis.
ETF assets were dragged down partly by a decline in funds with exposure to Malaysian bonds and stocks, according to a fund manager at a Malaysian asset management company.
“With the new Covid-19 variants emerging and the daily infection cases [well] above 10,000, it will be very challenging for the domestic stock market to stage a sustainable rally,” he tells Asia Asset Management, speaking on condition of anonymity.
The number of daily cases in Malaysia breached 20,000 early this month. The country now has the third-highest tally of cases in Southeast Asia after Indonesia and the Philippines since the pandemic began last year, with 1.49 million infections, including 13,480 deaths, reported as of August 20.
On a monthly basis, the value of ETFs traded jumped 41.68% to 15.84 million ringgit in June and the volume surged 71.35% to 6.34 million.