Home bias
Besides distribution, foreign fund managers will have to deal with competition.
“There is a strong home bias in the China market,” Lin said. Foreign fund managers need to find an effective way to compete against the investment capabilities, product offering and brand recognition of domestic managers.
“Local asset managers will also continue to grow in the next three-to-five years and they will also start to have a regional or even global brand,” he added.
Stewart Aldcroft, Cititrust’s Hong Kong-based chairman and managing director, added that foreign asset managers will spend a substantial amount of time and money to be recognised locally.
He believes 100% ownership of a domestic asset management firm is a huge opportunity for asset managers who prefer to “only do things in their own name” and do not want a joint venture.
“But they should be big enough and have the resources with which to build their own presence. Those that want to compete will need to build up a brand name. They need to spend a lot of money over the next few years to give themselves the opportunity to be known to by the public.”
