Asset management

Zeal Asset Management goes digital in effort to grow Chinese presence

Privately owned Hong Kong investment manager has partnered with Tianhong, best known as being an affiliate of Alibaba Group’s mobile payment platform Ant Financial and for creating Yu’e Bao, the nation’s largest mutual fund

PUBLISHED : Sunday, 19 November, 2017, 4:15pm
UPDATED : Monday, 20 November, 2017, 4:41pm

Zeal Asset Management has adopted the use of a new online platform to raise brand recognition and accumulate fund flows for a foray into China’s huge asset management industry, according to chief executive officer Franco NganWai Wah.

The privately owned Hong Kong investment manager, created in 2009, Zeal provides services to investors globally, including family offices, financial institutions, endowments, foundations, pension funds and individual investors.

The firm launches and manages hedge funds for its clients and invests in the Chinese public equity market, creating one of the first batch of funds approved to enter the China’s through the mutual recognition fund scheme (MRF).

Eight companies have been approved so far under the MRF, which allows mainland retail investors to buy Hong Kong-domiciled equity, bond or index-linked funds via the cross-border access programme.

“We needed to tell our Chinese clients precisely what Zeal represents because the first impression is very important,” Ngan said. “We concluded that the first step for us was to use digital platforms to do this.”

Casey Quirk, an asset management strategy consultancy of Deloitte Consulting, expects China’s assets under management to rise to US$17 trillion by 2030, up from US$2.8 trillion in 2016.

Chris Pigott, head of HK ETF services at Brown Brothers Harriman, added: “In the mainland, about 60 per cent of all fund flow from retail investors goes through online channels. “That’s pretty impressive when you consider in HK banks make up most of the distribution here.”

Zeal claims one of its online marketing campaigns was able to reach out to 15 million readers, and convey the message that very “in-depth” research was employed to pick Hong Kong stocks.

Zeal Voyage China Fund has partnered with Tianhong, best known as being the affiliate of Alibaba Group Holding’s mobile payment platform Ant Financial and for creating Yu’e Bao, the nation’s largest mutual fund. Alibaba owns the South China Morning Post.

Through the Ant Financial application, Chinese mobile phone users can receive digital marketing, investment information or be able to participate in discussion forums on Zeal’s fund products.

The data is thereafter collected, categorised into age groups and investment behaviours, and used for business analysis to produce highly-tailored branding or marketing campaigns for customers, Ngan said.

“With just a click to a link, you can make a purchase conveniently. This data is all traceable and we’ve accumulated useful experience,” Ngan said.

Of 71 Greater China and China equity funds authorised by the Securities and Futures Commission of Hong Kong, the Zeal Voyage fund has returned 90.67 per cent since its inception in 2010 to come in sixth place, while ranked top for the sharpe ratio – an industry standard that examines the performance of an investment by adjusting for its risk.

Ngan said now that Zeal has established a customer base of over 200,000 in China, it’s next step will be to further expand its distribution network by returning to the traditional, offline distributing approach and sell funds through big Chinese banks, securities and third-party wealth management companies.

“After having got clients get to us and our brand, then our next step is to open up to the offline approach.”