China’s AUM growth slows

China bicyclesAssets under management (AUM) in China grew 2% in the third quarter, failing to test the historic high in the previous period.

China saw second quarter AUM growth of 11.6%, but although the latest growth is slimmer, it is considered to be better than was hoped for given broader macroeconomic concerns and persistently poor performance of the domestic stock market.

A notable number of investors were “placing bets” on index funds towards the end of the third quarter, notes Z-Ben Advisors, a Shanghai-based consultancy.

The quarter saw significant redemptions from fixed-income funds, Z-Ben says. But with a stock market that shows “no signs of immediate recovery”, there is a real possibility that industry AUM will slump by year-end.

“However, with a notable volume of investors placing bets on index funds towards the end of [the third quarter], and a number of non-conventionally-designed products still in the pipeline, the industry appears to still have some fight left yet.”

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