Teamwork seen as key to success for funds
Fullgoal's chief executive says investors should consider how companies risk their money instead of placing their faith in star managers
Dou Yuming, the chief executive of Fullgoal Fund Management, believes successful investment strategies are the result of team efforts rather than the wizardry of a star manager.
"The tactic of chasing star fund managers has proved unsuccessful for investors," Dou said. "Indeed, it's the investment team, or to be precise, their decision-making process, their attitude towards risk control and the sustainability of their performances, that should be considered."
The tactic of chasing star fund managers has proved unsuccessful for investors ... it's the investment team and their attitude towards risk control and the sustainability that should be considered
Millions of retail investors on the mainland have placed their faith in iconic fund managers whose Midas touch, they hoped, could generate heady gains. But Dou, who has a master's degree in business administration from US-based Tulane University, cautioned against this approach.
The 44-year-old took charge of Shanghai-based Fullgoal in 2008 and began introducing quantitative investment - an investing technique that uses computers to find predictable patterns in financial data - to the company.
"As a new investment style and theme, quantitative investment helps mutual fund firms broaden their product lines," Dou said. "It's one of the major innovations in the industry."
At the end of last year, Fullgoal had funds worth 75.5 billion yuan (HK$94.8 billion) under management, up 21.4 per cent from a year earlier. It was ranked No13 among the country's 70 mutual fund companies by assets under management.
Beijing has been encouraging institutional buying to set a healthy tone for the market. But the industry, with assets of nearly three trillion yuan, has suffered a huge brain drain in the past few years as hundreds of fund managers jumped ship to hedge funds, which offered them better pay perks.