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Citi Transaction Services | Citi OpenInvestor
Executive Summary
Key Findings:
Asset Management Overview
• Substantial growth in the mutual
fund market should be expected.
We forecast at least RMB6.8tr
(USD1tr) in total assets by 2015,
up from RMB2.3tr (USD360bn)
today. Gains in equity markets and
net infows from new investors will
be the cause. Even slight policy
changes are set to increase retail
fund participation.
• While AUM may improve,
advancements in advice have yet to
materialize. Domestic banks do not
offer post-sale servicing, and with
fund managers lacking in this area,
investor loyalty is minimal.
• Personnel turnover remains a
key concern. Competition from
other segments — brokerages,
private fund and insurance asset
managers — has meant a slow but
consistent outfow of the most
skilled fund managers, with obvious
consequences for performance,
brand strength and reputation.
Institutional Investing
• Asset diversifcation needs will
drive institutional investors into
offshore markets, ready or not.
The search for higher returns
and lower correlations will lead
institutions toward PE, equities and
alts. Finding the right match for
each new client, however, will prove
extremely challenging.
• China’s institutional market will
become much broader over the
next decade as a large number of
smaller players, including insurers
and pensions, make their debuts.
Targeting these will require a much
more active approach, as few have
experience dealing with global
managers or markets.