SINGAPORE: Concerns over China have resulted in an outflow of funds from Asia, hurting fund management firms based in the Republic. However, the Investment Management Association of Singapore (IMAS) has said the industry is still growing, as more fund managers set up operations in Singapore.
Citing a recent survey, IMAS said 85.1 per cent of fund managers listed China's weakening economy as one of their top three concerns. IMAS added that the industry faces increasing regulatory obligations which are costly, as well as rising competition from other financial centres.
Although the industry faces various challenges, IMAS said the sharp fall in Asian markets creates new opportunities for fund managers in Singapore.
"If you asked me this two weeks ago, I would have looked to a weaker 2016, but a lot of that weakness has happened already,” said chairman of IMAS Nicholas Hadow. “Now could markets fall another 10 to 20 per cent? Of course it’s possible, but after a 20 per cent fall already, we’ve got to be starting to think about the opportunities out there."
Mr Hadow added that multi-asset funds have done well over the last few months, as investors focused increasingly on yield. Hedge funds are also seeing a recovery, after several years in the wilderness.
IMAS represents more than 100 investment managers in Singapore who together manage more than S$800 billion in assets.