Management Surveys: Hong Kong fund managers top of the class
Citywire, a London-based financial publishing and information group focused on the fund management industry, has come out with its latest global rankings of fund managers, including a ranking of the top Hong Kong managers. (See table.)
These managers are deemed to have local appeal, and are at least partly based in Hong Kong. The funds they manage are available to Hong Kong investors.
It is difficult to compare funds managing different assets across markets. For example, equity funds typically outperform bond funds, but equities are also riskier than bonds. When they lose money, they tend to fall a lot further than debt-focused funds. So a simple comparison of returns would be misleading.
The Citywire survey accounts for this fact by first looking at the extent to which a fund beats its stated benchmark. It next looks at the consistency of returns. If two fund managers made a 10 per cent return over three years, the fund that made slow and steady gains would be ranked higher than a fund with more volatile returns.
The survey does not consider fees in its calculations, on the view that fees vary by market and cannot be consistently reflected in the global survey.
Richard Lander, a Citywire director based in London, says the Hong Kong rankings are notable in the strong presence of equity funds in the list.
The Hong Kong list was extracted from a global survey of the top 1,000 fund managers, and this larger list is dominated by bond funds.
"Generally, in the bigger list, it's been a tougher time for equities managers," says Lander. "We have good locally based managers doing well in equities, which shows the advantage of injecting a good local manager. Do you want your Chinese funds run from London, or do you want the guy who is embedded in the local investment community, who can sniff out opportunities.
"I think people are moving towards the latter."
Fidelity bond fund manager Bryan Collins is at the top of the Hong Kong rankings. He also ranks eighth in the global 1,000, which is a strong showing.
By comparison Toby Hudson, a Schroders equities fund manager, is ranked second, but 123 globally.
The survey adjusts for career breaks and job changes. Citywire will follow managers as they move from firm to firm, tracking total returns at the funds he or she manages, regardless of employer. The survey is useful in that it identifies managers who beat their benchmarks and outperform their peers, and therefore justify the yearly management fees.
Citywire covers managers offering funds in 35 countries. It ranks all managers free of charge - that is, it does not ask managers for a fee to appear in a ranking, as is the case with many such surveys.
AKG Actuaries, which is based in Britain, audits the survey's methodology and ranking.