HONG KONG (HedgeWorld.com)–Rising domestic demand and increasing inflows of international funds allocated to Asia-focused strategies contributed to Hong Kong’s continuing growth in the fund management business in 2005.
The combined fund management business amounted to HK$4.526 trillion (US$580.26 billion), representing a sizable year-on-year growth of 25%. Overall, 66% of assets under management were sourced from overseas, with the remaining 34% attributed to Hong Kong investors.
In its annual Fund Management Activities Survey for the year, which ended Dec. 31, 2005, the Securities and Futures Commission noted: “The continuous growth of AUM sourced from overseas reflected significant interest from overseas investors to make investment allocations to the Asia-Pacific region in view of the great potential and strong growth in the PRC and regional markets.”
A significant portion of the total non-REITs HK$3.242 trillion AUM (also excluding pure advisory assets and other private banking activities) by SFC-licensed corporations and registered institutions, HK$1.725 trillion (U.S.$221.15 billion) or 53%, was managed in Hong Kong, representing 18% year-on-year growth in value terms.
Of the HK$721 billion worth of assets invested in Hong Kong, 65% were in equities and 25% in bonds, similar to past years. The remaining 10% was invested in cash, deposits, or money market instruments; derivatives or structured products; or other investments.