The FSA Spy Market Buzz 04 Sept 15

By FSA Spy

Added 4th September 2015

New intermediary head at T. Rowe Price, Manulife AM pinches from Schroders, economic outlook gloom in Hong Kong, ETF liquidity deserts, HSBC Gam head relocates and much more.

The FSA Spy Market Buzz 04 Sept 15

Spy found himself back in the Captain’s Bar at the Mandarin Oriental this week. The volatility seems to be keeping even the most well-heeled drinkers at bay. Captain’s was uncharacteristically quiet and deserted as he sipped an 18 year old Ardbeg Single Malt, listening for gossip. Long gone are the days of the cigar smoke-filled,  bustling bull market and it made Spy nostalgic for the heady days of 2007 when getting through the door was a challenge, let alone finding a spare seat. 

Spy finally confirmed where Elsie Chan, formally of UBS GAM has gone: T. Rowe Price have snapped her up to head intermediary distribution in Asia. Spy notes that she is reunited with her old chum, Scott Keller, also an UBS GAM alumnus who is Head of Global Investment Services, Asia Pacific at T. Rowe. No doubt private banking doors will be knocked on in the weeks and months to come as Elsie brings her boundless energy to the American giant

Through the quiet hum of chatter in the Captain’s Bar, Spy also overheard the news that Grace HoSchroders’s former head of marketing in Asia, is joining Manulife Asset Management, contrary to street chatter that she had taken the CMO job at JP Morgan AM.  She is going to work alongside Bruno Lee, reporting to Michael Dommermuth as Manulife build their 3rd party distribution business.

Is HSBC sending another warning to the UK treasury not to overtax the much-fined bank, spy wonders? Sridhar Chandrasekharan, the Global CEO for HSBC Global Asset Management has recently moved his office from London to Hong Kong, surely depriving HMRC of some lucrative income tax in the process.  The official line is all about oversight and development and opportunities to grow. Still, Spy is only too happy to see Asia greater attention from any asset manager CEO.

Spy’s digital meanderings in the moderately reliable profiles of LinkedIn bring happy news about Chris FaddyBNY Mellon’s former head of distribution for Asia of BNY’s ill-fated managed account service. Chris has joined startup Vantage Point Asset Management in AustraliaSpy tips his hat to VPAM and wishes the team the best of luck.

Ordering a second dram, Spy reflected on the gloomy sentiment that came out of FSA’s Alternatives Forum in Hong Kong at the Four Season Hotel this week. More than 75% of the more than 45 high-level fund buyers and analysts in attendance had a negative or uncertain outlook on the economy for the next 12 months, the worst poll results in five years at an FSA event. The gloom seemed to echo the strange, deathly quiet in Hong Kong’s Wanchai drinking establishments. With a chilly wind blowing from China, these are unsettled times indeed!

Spy’s eyebrow was raised at some extraordinary data reported by Bloomberg in an article about a successful Internet security ETF called HACK: “There are 6,500 ETFs in the world, with $3 trillion of assets under management. A new ETF rolls out, on average, every business day. The industry is surging, for a variety of reasons. Investors are dumping mutual funds for ETFs, which have a reputation for lower fees.”  And yet, the article goes on to say, “…That’s the dirty secret of the ETF industry. All of the innovation has led to a lot of failure. Many ETFs are zombies…the biggest problem with ETFs is liquidity. Some of the small ones trade so infrequently that they are hard to sell if you own them.” Spy reckons there is no such thing as free lunch.

Spy’s trusty band of roving photographers have spotted little new asset management advertising in Hong Kong or Singapore of late. Aviva Investors had a modest print advert in the Straits Times in the past week or so, with a generic corporate branding flavour. We all wait patiently for their AIMS launch, which is AI’s version of Standard Life’s GARSstrategy, which may bring a more lively campaign.


Meanwhile, the Singapore Government Nanny is out admonishing its citizens to get better educated about financial matters. On this occasion, Spyagrees with Nanny: all citizens globally seem woefully under informed and uneducated about finance. As the saying goes, “people will spend more time choosing golf clubs than their pension plan”.  


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