The region's fund distribution industry is one of the most competitive in the world.
We believe singling out the top performers based on independent, data-driven criteria can provide a fund house with a valuable distinction among its peers and help distributors to get consumer support.
The awards are particularly relevant because FSA uses both quantitative and qualitative methods of selecting the winners.
How it’s done
FSA’s awards are based on data from FE Advisory Asia, which screens the universe of funds in Hong Kong (1289 eligible funds) and Singapore (2374 eligible funds) for alpha, volatility and consistency across 15 classes. FE then creates two shortlists – one for Hong Kong and a separate one for Singapore.
(In Hong Kong, funds have to be registered for retail sale to be eligible. In Singapore, funds with "Accredited Investor" status are eligible).
The methodology for the shortlists is 100% quantitative, providing an apples-to-apples comparison, according to Luke Ng, vice president of FE Advisory Asia.
The role of fund selector judges
The shortlists are then given to independent panels of well-known professionals from Asia’s fund selector community. Hong Kong and Singapore have separate judging panels to reflect the difference in offerings.
FSA provided only one question to guide them, and it was forward-looking:
Given this list, which fund within each asset class do you think will perform best over the next 12 months?
The judges' selections will determine the winners (Platinum and Gold). Winners will be revealed in early January.
Asia fund trends
After compiling the shortlists, the team at FE noticed a few trends that give a snapshot of the regional fund landscape.
“In general, most funds shortlisted are pursuing a growth strategy rather than a value strategy," Ng said.
“In the Hong Kong universe, there was strong competition for the shortlist in the global equity, mixed asset and Asia-Pacific equity categories. In Singapore, it was a hard fight in global bond, Asia-Pacific equity and US equity categories.”
Ng also noted that the shortlist has a mix of big and small asset managers, although Singapore had a stronger showing of boutique houses than Hong Kong.
However, Chinese asset managers are relatively new to the market and have a small presence. “They generally have less funds available to invest in different categories than global players.”
Is your fund on the shortlist?
As a prelude to the announcement of the winners, FSA will be publishing the shortlists beginning on Friday. Keep an eye on fundselectorasia.com