In less than two years, UOB Asset Management (UOBAM) has attracted more than S$1 billion (US$750 million) in assets under management (AUM) from individual investors across Asia for two funds, the United China-A Shares Innovation Fund and the United China-A Shares Consumption Upgrade Fund.
Ping An FMC, a joint venture established in 2011 between UOBAM and Ping An Trust, is the investment adviser of the two funds, which have drawn strong investor interest from Japan, Malaysia, Singapore and Thailand. More than one-third of the total AUM was invested in the second half of 2020, as investors from across the region rode on China’s equity market boom backed by its economic and corporate earnings growth. This was in turn driven by the country’s early recovery from Covid-19 as well as favourable fiscal and monetary policies.
As of April 29, the United China-A Shares Innovation Fund has achieved returns of 143.13% since its inception in August 2019 and an annualized return of 67.70%, outperforming major indices such as the CSI300 Index and MSCI China A Shares Index. The United China-A Shares Consumption Upgrade Fund has achieved returns of 32.71% since its inception in August 2020.
The two funds are riding on the global megatrends of technology, innovation and quality consumption prevailing in China, UOBAM says. The country is home to many high-growth companies across various sectors that are leading the world in innovation, from precision engineering and artificial intelligence to clean energy and electric vehicles. With rising disposable income, China’s increasingly affluent consumers are also purchasing more quality brands and products. Companies tapping these megatrends present a wealth of investment opportunities for investors across the region.
“Since UOBAM obtained our RQFII (Renminbi Qualified Foreign Institutional Investor) licence in 2015, we have been tapping Ping An FMC’s local expertise to offer investors outside China direct access to the country’s onshore investment opportunities,” says Thio Boon Kiat, chief executive officer of UOBAM and director of Ping An FMC.
As of the end of 2020, Ping An FMC had more than 110 million customers with AUM of more than 600 billion yuan (US$92.7 billion).