The annual assessment of international managers operating in, selling to and selling from China, has shown some changes among the top ranks. China is now the ‘priority for most global managers’, according to the latest Z-Ben study. UBS, Schroders, BlackRock, Fidelity and Manulife are the big winners.
Z-Ben, the Shanghai-based research firm which specialises in providing information to foreign fund managers, says in its latest assessment ‘2018 Rankings – the top foreign firms in China’, that the top five firms in the China rankings have pulled away from the rest over the past 12 months.
Each of the top five has its own joint-venture fund management stake plus an onshore investment management platform. Not only do they have the “best China presences” but they are also growing faster than their peers. They are: UBS, J.P. Morgan, Schroders, Invesco and BlackRock.
Of the top 10, only Fidelity does not have a joint-venture operation. It was the first foreign private fund business in China and has launched the most products. The other four big foreign managers are: HSBC, Morgan Stanley, ManuLife and Deutsche Asset Management.
According to the report, diversification is the key facet of the best China strategies. Growing China demand from global investors and offshore demand from Chinese investors have complemented onshore fundraising. Managers lower down the list rely too heavily on a single joint venture stake or wholly-owned onshore investment platform, leaving them unable to capitalize on demand for other business lines, the report says.