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Hong Kong mutual fund sales rebound as hopes of interest rate pause stems last year’s massive outflows
- Hong Kong funds saw a net capital inflow of US$15.51 billion in the first quarter, ending five quarters of capital outflow, industry data shows
- Bond funds drove the recovery as the prospects of a slowdown in interest rate hikes hike improve sentiment
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Hong Kong’s mutual fund sales bounced back strongly in the first quarter after the worst net outflow on record last year as market sentiment improved amid a more stable interest rate environment, according to fund managers and regulators.
Retail fund sales in Hong Kong in the three months to March outweighed redemptions by investors, resulting in a net capital inflow of US$15.51 billion, according to data from the Hong Kong Investment Funds Association, the industry body that represents the local units of international fund houses.
“The mutual fund market in Hong Kong has improved significantly this year as new sales of funds have started to bypass the amount of redemption,” said Nelson Chow, chairman of the HKIFA.
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Chow is also managing director of the Hong Kong unit of AllianceBernstein, a US fund house with US$680 billion of assets under management worldwide.
The inflow in the first quarter has put an end to five consecutive quarters of net outflow. The outflows began in the fourth quarter of 2021 at US$575 million, and was followed by total outflows of US$7.74 billion last year, the highest since HKIFA started publishing the data in 1999.
05:31
Hong Kong Monetary Authority chief Eddie Yue on future of city’s economy amid higher interest rates
Hong Kong Monetary Authority chief Eddie Yue on future of city’s economy amid higher interest rates
The city’s mutual funds enjoyed a net inflow of US$8.8 billion in 2021, reversing a US$5.65 billion outflow the previous year, HKIFA data showed.
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