Local currency bond funds favoured by Asia-Pacific investors

Asian_currenciesBond funds domiciled in the Asia-Pacific region and denominated in Asia-Pacific currencies gained net inflows of $5.6 billion (€4.3 billion) in 2011, according to research firm Cerulli. But bond funds domiciled in the region and denominated in dollars, euros and other world currencies suffered redemptions of $16 billion. The report suggests the growth was driven by the most developed regional markets, Japan and Australia, rather than the emerging economic powers such as China and India. Five of the top ten Asia-Pacific bond funds by net new flows were funds denominated in the Australian dollar. These were particularly popular among Japanese investors, who ploughed $11.6 billion of net new money into the funds during 2011. The Japanese yen has declined about 10% against the Australian dollar since January this year. Elsewhere, Asia-Pacific currency bond funds gained inflows from their home markets. Bond funds denominated in Japanese yen gained $2.3 billion in Japan, while bond funds denominated in Malaysian ringgit gained $1.2 billion in Malaysia. There was great initial interest in bond funds denominated in the Chinese renminbi during 2011, but inflows were inconsistent. Cerulli said 14 funds were launched in the second quarter and inflows hit $2.3 billion in June, but in the rest of the year, these funds saw net outflows or meagre inflows. ©2012 funds europe

Executive Interviews

INTERVIEW: Put your money where your mouth is

Jun 10, 2016

At Kempen Capital Management, they believe portfolio managers should invest in their own funds. David Stevenson talks to Lars Dijkstra, CIO of the €42 billion manager.

EXECUTIVE INTERVIEW: ‘Volatility is the name of the game’

May 13, 2016

Axa Investment Managers chief executive officer, Andrea Rossi, talks to David Stevenson about bringing all his firm’s subsidiaries under one name and the opportunities that a difficult market...


ROUNDTABLE: Beyond the hype

Oct 13, 2016

The use of smart beta investing continues to grow. Our panel, made up of both providers and users, discusses what the strategy actually means, how it should be used and the kind of pitfalls that may arise when using this innovative investment technique.

MIFID II ROUNDTABLE: Following the direction of travel

Sep 07, 2016

Fund management firms Aberdeen and HSBC Global meet with specialist providers to speak about how the industry is evolving towards MiFID II.