Schroders’ Amy Cho: Global credit sells well in Hong Kong

Amy Cho has been Schroders’ Hong Kong chief executive and regional head of intermediary clients since December 2018.

Hong Kong investors are famously short term, but she told Funds Europe recently that things were changing.

“People started to have a longer-term outlook on financial planning or retirement savings, even though Hong Kong enjoys a very simple tax regime. The introduction of the MPF [a compulsory pension scheme] helps investors to be aware about how to save money over the long-term and after retirement to sustain the same quality of life,” she says.

Funds Europe asked if the continued US-China trade war was affecting investor confidence and investments?

“I wouldn’t deny that. On the institutional side this year, investors have been a bit more cautious and the risk-off mode is still on. On the intermediary space, whether private bank clients or retail investors, they stay cautious but are not avoiding all risk. So, they are not in total risk-off mode, they still stay invested but pick the more prudent investment options, including the income-oriented solutions.”

Cho says global credit income strategies have been selling well, against a background of the ‘inverted yield curve’.

“Starting from late last year, given the interest rate trajectory, what has been selling successfully this year is global credit income, so it is very globally diversified.

“Investors are more willing to take on credit exposure – high-grade investments that will generate better returns than bank deposits for them. Because of the low interest rate environment, putting money in the bank is not yielding anything after inflation adjustment, so this trend will likely continue.”

The full interview, which also covered ESG demand, appeared in Funds Europe’s October issue and is online here.

©2019 funds europe

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