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Unearthing Asia’s Growth Potentials


UNEARTHING ASIA’S GROWTH POTENTIALS

ronald-chan

Ronald Chan
Chief Investment Officer of
Asia ex-Japan Equities
Manulife Asset Management

With its extensive array of constituent funds and all-round MPF services, Manulife staged a comeback in 2017, winning the “Provider of the Year – MPF” title for the third year. To score the highest in this award, the winner must stand out on three fronts: fund performance, brand health and overall business capabilities. But Manulife goes decidedly above and beyond in both customer services and fund management. Little wonder the MPF service provider has gained significant MPF market share over the past decade.

As the largest MPF provider, with more than one-fifth of the market share in terms of the total MPF assets, Manulife is more determined than ever to forge ahead in the MPF sphere. Ronald Chan, Manulife Asset Management’s CIO of Asia ex-Japan Equities, revealed more.

BENCHMARK (BM): With more than 80 years of experience in the Hong Kong pension industry, what are the core values that sustain your business?
Ronald Chan (RC): In our long history of serving the Hong Kong community, we’ve stayed true to our core principle – to understand and fulfill our clients’ aspirations. We’re a sizable company, but we attach great importance to service details. From retirement planning to wealth succession, our goal is to meet clients’ specific needs. This customer centric thinking extends to the manufacturing of investment solutions. We try to incorporate the widest scope of investment vehicles into our offerings so that we can tailor products to cater different needs.
While we also focus on delivering returns, risk factors are our first and foremost consideration. We aim to achieve consistency in fund performance. Therefore, the motto “Avoid taking undue risks” is an integral part of our investment culture.
BM: Besides service infrastructure, your investment process also forms a backbone to your MPF business. Can you share withus your investment philosophy?
RC: Certainly! We adopt a long-term, fundamental approach to investment. With more than 80% of our alpha generated through stock and sector selection, our investment method is designed to uncover industry leaders who can weather business cycles and perform in the longer term.
We also apply stringent screens to filter stocks. To be included in our portfolios, a company must demonstrate strong cash flows, have good corporate governance, possess sustainable growth drivers, and be reasonably valued. At the initial stage of the investment process, we search for stocks with below-intrinsic-value valuations. But that’s not enough – we need to have sufficient reasons to believe that the valuation gap will narrow in the future.
The above investment process, and the way we conduct stock, sector and country research, are applied to all our 11 offices in Asia. This way, the market views of our investment teams can be aligned, and team members stationed at different locations can create synergy by leveraging each other’s insights.
BM: Let’s talk about your investment views. How do you see the current investment environment in Asia? And what do you think is the most prominent investment theme today?
RC: In the past 12 to 18 months, major economies saw a resurgence of economic activities on the back of synchronized global growth. At the same time, inflation stayed mild and was below trend. This is a very benign environment for equity investors in Asia.
The most appealing investment theme – also the most under-researched one – is the high level of household savings in Asia. The enormous pool of savings, when channeled into investments, will be a boon for the region’s economies. In fact, the savings to-investment transition is already taking place. For example, Indian retail investors are investing a larger share of their savings in the local bourse, while China’s household savings are bolstering the Hong Kong stock market in the form of southbound flows. Similar trends are found in Taiwan and Korea, implying that domestic capital will be an increasingly important driver to the Asia stock markets.
BM: Is this one of the reasons your MPF Hong Kong Equity Fund delivered strong performance last year? With your expectation of Asia’s domestic savings to continue shoring up stock market performance, where will growth come from within the region this year?
RC: The China and Hong Kong market is the bright spot. We see a multitude of positive factors in play here. Firstly, southbound capital flows, which fueled the stock rally in 2017, are expected to remain sanguine and buoy the Hong Kong market this year. Blue chips favored by southbound capital will be the biggest beneficiaries under this trend. We have already positioned our portfolios accordingly.
Another potential catalyst to watch for is the possible overhaul of IPO rules in the Hong Kong stock exchange. If rules are rewritten to accommodate alternative shareholding structures, it may trigger a new wave of IPOs, especially in the technology sector. If the proposed listing reform becomes reality, it will usher in compelling opportunities in the “new economy” sectors.
Furthermore, foreign investors’ allocation to China remains subdued as they are still wary of the risks of a hard landing in the Chinese economy. However, as China strives for amore sustained and healthier growth, we believe that foreign investors will revisit the validity of the Chinese market soon, which bodes well for Chinese stocks in the long run. On top of that, the ongoing reforms in China are expected to engender tremendous investment opportunities. This also makes a strong case for investing in China and Hong Kong equities.
BM: Looking ahead, what developments do you anticipate in the MPF market?
RC: : We expect the consolidation in the MPF industry to gather steam going forward, and small-sized MPF providers will likely face heftier operating costs. When an increasing number of small providers merge with larger ones, MPF members, in particular, those holding multiple personal accounts in different trustees, will have to consolidate their accumulated benefits. Under this development, and as always, we will continue to strengthen our presence by staying client-centric. BM

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深耕亞洲發掘增長潛力

ronald-chan

亞洲區(日本除外)股票投資部
首席投資總監陳致洲
宏利資產管理

著豐富的基金產品組合,以及全面的強積金服務,宏利於2017年再創佳續,第三度成為年度供應商(強積金) 大獎贏家。要贏得此殊榮,供應商必須在基金表現、品牌聲譽,以及整體業務實力三方面領先同儕。宏利不僅於這三領域的成績優異 ─ 公司在客戶服務及基金管理的表現同樣優秀,因此,宏利於過去短短十年大幅增加其強積金市場佔有率。目前,宏利已晉身成為香港最大規模的強積金供應商,佔強積金市場份額逾五分之一(以於市場佔有的強積金資產值計算),但公司的願景不絕於此 ─ 宏利銳意繼續引領強積金市場,宏利資產管理亞洲區(日本除外)股票投資部首席投資總監陳致洲與我們分享更多:

《指標》:宏利紮根香港退休金行業逾八十年。貴公司有何核心價值,支持業務長久增長?
陳致洲:宏利服務香港多年,一直秉持一個核心原則 ─ 明白及滿足客戶所需。雖然公司規模龐大,但我們十分重視服務細節。不論是為客戶擬定退休或財富傳承計劃,我們均以「滿足每一個客人的需要」為目標。於投資方案設計上,我們的產品組合盡量涵蓋更多元化的投資工具,為客人提供度身訂造的投資方案,以滿足他們的不同的需要。
為客人爭取優越回報是宏利的服務重點,我們的投資團隊更視投資風險為重要的考慮因素。宏利的投資團隊致力維持穩定的基金表現,故「避免過度承擔風險」是我們投資方針的重要一環。
《指標》:除了優良服務,投資流程亦是宏利強積金業務的致勝關鍵。可否與我們分享你們的投資哲學?
陳致洲:當然可以!我們的投資策略是以基本面研究及長線投資為依歸,投資組合中有超過80%的額外回報(alpha)源自選股及板塊配置,並以發掘能夠抵禦不同週期、可貢獻長期表現的行業龍頭為投資目標。
選股方面,團隊亦設定一套嚴格的篩選程序,被納入投資組合的個股均需符合多項條件,包括擁有穩健的現金流、優良的企業管治、可持續性的增長,以及合理的估值。在投資流程之初,團隊會先發掘估值低於內涵價值的股票,除擁有吸引的估值外,我們更會掌握充分理據,計算個股的估值落差會否收窄才會將其納入組合。
宏利在亞洲區的11個辦事處亦採取同樣的投資流程,包括股票、板塊及地區研究等。此舉可貫徹宏利於各地的投資團隊的市場觀點,而駐守不同市場的投資隊員亦可借助其他地區同事的專長,發揮協同優勢。
《指標》:轉談你的投資觀點,你如何看待目前的亞洲投資形勢?現時哪個投資主題最具潛力?
陳致洲:回顧過去12至18個月,環球經濟同步增長導致多個主要經濟體重拾動力。同時,我們預期通脹率會維持溫和及低於歷史平均水平,為亞洲股票投資者造就有利的投資環境。
目前最吸引、最被市場忽略研究的主題是亞洲的豐厚儲蓄。若此龐大資金池轉化成投資資金,將對亞洲區經濟非常有利。事實上,區內的儲蓄資金已開始注入投資市場,例如印度零售投資者轉投放更多儲蓄於當地股市,而中國內地居民的儲蓄則透過南下投資渠道帶動香港股市,類似情況亦見於台灣及南韓,反映本土資金對亞洲股市的推動作用愈來愈重要。
《指標》:南下資金是否造就宏利強積金香港股票基金去年獲佳績的因素之一?你曾預計亞洲的儲蓄將繼續支持股市表現,今年區內還有甚麼增長亮點?
陳致洲:中港股市存在多項催化劑,將繼續成為增長亮點。首先,推動2017年股市升勢的南下資金料將保持強勁勢頭,繼續支持今年香港市場表現。南下資金偏好的藍籌股將成此趨勢下最大的受惠者,我們亦已為組合做好部署。
此外,香港交易所或將修改上市規則而成為股市催化劑。由於有關建議規例容許擁有另類股權結構的企業來港上市,是項修例或將觸發新一輪上市潮,尤其是科技類企業。一旦相關機構落實上市改革建議,我們預期「新經濟」板塊將提供吸引的投資機會。
再者,海外投資者擔憂中國經濟存在硬著陸風險,對此市場仍存有戒心,故中國市場的配置仍然偏低。然而,隨著中國經濟增長的主軸轉向可持續、更健康的發展,我們相信海外投資者將重新審視中國市場,長遠而言對中國股票市場發展有利。
最後,中國改革進程不斷推進,將為中港股票投資者提供有力的理據,並帶來可觀的投資機遇。
《指標》:展望未來,你預計強積金市場將如何發展?
陳致洲:我們預計強積金市場的整固趨勢將加快,由於小型強積金供應商的經營成本不斷增加,更多小型強積金供應商或會與大型供應商合併,因此,強積金成員將需要整合他們的累計權益,尤其是持有多家強積金供應商的個人帳戶的成員。宏利將一如既往,繼續以客戶為中心,並加強我們的業務實力。 BM

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