THERE will be a boom in the new Asian mutual funds over the next five years, Nigel Down, a director of Thornton Investment Management, said yesterday. He also predicted greater harmonisation of regulatory controls across the region. He said: ''We must take care to check what our investors want. A lot of the time we lose sight of what that is. ''Investors have different aims. In more developed markets, such as Hong Kong and Taiwan, they want to know more about fund management companies, fund managers and their choice of funds.'' He compared investors in Indonesia, who until recently could receive between 15 and 20 per cent on fixed returns, to Hong Kong where savers have to deal with negative real rates of returns from the banks. ''This means that in Hong Kong they have little choice but to invest in the stock market.'' Mr Down told the delegates, who were mainly representatives of European and North American companies considering Asian markets, that companies needed to be flexible. He said: ''Products need to address not just different needs but also different product developments. For example, what is local level of investor knowledge? ''In countries like China and India, the type of product might not be well-known. This means that companies will have to discuss things like how can the investor sell or how can they get their money back? ''In developed countries, many investors are asking more questions about fund management companies and fund managers.'' Mr Down also advised fund management groups considering the region to understand the investment culture of their host country. ''There is a need to look at different countries more closely because of the greater diversification. In Hong Kong investors go directly into the market. During the past five to six months we have seen enormous inflows from Taiwan. ''Taiwanese might invest on the Monday and redeem on the Friday. In North America and Europe many consider warrant and derivative funds to be too risky. But for the Taiwanese investors they are particularly important.'' Mr Down said that in general Asian investors preferred equity funds because there were few alternatives. ''But over the next four or five years we will see a great growth in bond funds.'' Mr Down said investors would consider a fund's fees, investment aims and the procedures for dealing before making an investment.