Asia may not see a sizeable domestic asset management industry for a long time, owing to Asians' reluctance to invest, asset management executives said during a panel discussion at a hedge fund conference in Hong Kong on Monday, according to Reuters.
In markets such as Japan and China, savers abound and "one hurdle is just how risk-averse those savers are," said John Stewart, head of Japanese equities for British fund manager Gartmore.
The backbone for an asset management industry in countries like China, which has over $1.5 trillion in savings, is just not there yet, executives said.
China's $40 billion mutual fund industry pales in comparison to the United States' $8 trillion industry. Sound infrastructure, such as a proper pension system, is badly needed. "Until then, I don't think there's much of a proper asset management business there," said Jerry Wang, chief executive officer of Vision Investment Management, which invests in several hedge funds.
Asia's less-developed markets, however, offer more promise than South Korea and Japan because they are more likely to attract international expertise, said Ross Garnaut, executive chairman of Sequoia Capital Management and the Australian ambassador to China from 1985 to 1988. These markets "[create] more opportunity for introducing international products into China and Southeast Asia," Garnaut said.
Indeed, in spite of the lack of a strong indigenous market, foreign money is pouring into the region. "We're going to get involved ... it's where the action is," said Arthur Samberg, CEO of Pequot Capital, which has about $6 billion in assets under management.
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.