SINGAPORE FUND FLOWS SUMMARY QUARTER END ANALYSIS
Total Net Fund Inflow Slid, Bond Funds Encountered A Significant Net Outflow In 4Q2014 Unit trusts registered for sale in Singapore, in aggregate, registered a net inflow of S$101.22 million in 4Q2014, a 89.79% decrease compared to last quarter. Mixed-asset funds continued its leading position of net inflow in the period. Alternatives, bond, commodity and money market funds all suffered a net outflow in 4Q2014, while mixed-asset and equity types gained S$403.15 and S$69.97 million, respectively, in the period. The total inflow of capital in 4Q2014 slid 20.13% to S$5,612.35 million, while the total outflow of capital fell 8.69% to S$5,511.13 million. Equity funds continued beating other asset type of funds but slid 14.53% to S$2,153.85 million capital inflow in 4Q2014, while bond funds slid 33.10% to S$1,321.51 million in the period. The capital outflow of equity funds fell 14.34% to S$2,083.87 million in 4Q2014, while bond funds recorded a capital outflow S$1,680.48 million, sliding 16.46% in the period. Mixed-asset funds capital inflow slid 22.97% to S$1,353.55 million in 4Q2014, while its capital outflow rallied 30.04% to S$950.39 million in the period. Contents 1. Fund Flow Overview for Q4 2014... 1 2. Equity Fund Flow Analysis... 3 3. Bond and Money Market Fund Flow Analysis... 5 4. Mixed-Asset Funds Flows Analysis... 6 5. Outlook... 7 6.1 Appendix A Data Sources... 8 6.2 Appendix B Net Fund Flow by Lipper Global Classification for Q4 2014(S$ Million)... 9 6.3 Appendix C CPF Fund Flow by Lipper Global Classification for Q4 2014(S$ Million)... 12
1. Fund Flow Overview for Q4 2014 Table 1 Estimated Fund Flow by Major Asset Classes for Q4 2014(S$ Million) Inflows Outflows Asset Class CPF Non-CPF Total CPF Non-CPF Total Net Flows Alternatives 0.00 0.30 0.30 0.00 6.28 6.28 (5.98) Bond 0.75 1,320.76 1,321.51 1.43 1,679.05 1,680.48 (358.97) Commodity 0.00 1.38 1.38 0.00 7.39 7.39 (6.01) Equity 59.59 2,094.25 2,153.85 75.12 2,008.75 2,083.87 69.97 Mixed Assets 4.70 1,348.85 1,353.55 18.40 931.99 950.39 403.15 Money Market 0.00 781.76 781.76 0.00 782.71 782.71 (0.95) Total 65.04 5,547.31 5,612.35 94.95 5,416.17 5,511.13 101.22 NB: Non-CPF numbers may include flows into/from the Supplementary Retirement Scheme (SRS) accounts as well as selected sophisticated funds distributed by participating IMAS members. Total net flows in the table may differ because of rounding of numbers. For there re different assets types in alternatives, the total net flows of bond type has included Absolute Return USD Medium. Equity type has included part of Absolute Return Other and Mixed-Assets has included part of Absolute Return Other and Absolute Return USD High. Mixed-Assets include Target Maturity Funds. Based on data submitted by participating IMAS members (see Appendix A), the various authorised and recognised unit trusts registered for sale in Singapore, in aggregate, registered a net inflow of S$101.22 million in 4Q2014, a 89.79% decrease compared with a net inflow of S$991.58 million in 3Q2014. By asset-type fund group, bond funds suffered the biggest net outflow of S$358.97 million, while mixed-asset funds enjoyed a net inflow of S$403.15 million and became the most popular fund type in 4Q2014. Equity funds continued to show a net inflow of S$69.97 million in 4Q2014, but dropped 19.68% compared to 3Q2014. On a quarterly basis, the amount of capital inflow into most fund types dropped, while only money market funds gained slightly by 1.34%. The capital inflow to equity funds slid 14.53% from S$2,519.87 million in 3Q2014 to S$2,153.85 million in 4Q2014. It accounted for 38.38% of the overall capital(s$5,612.35 million) inflow into the unit trusts in 4Q2014. The capital outflow of equity funds also dropped 14.34% from S$2,432.75 million in 3Q2014 to S$2,083.87 million in 4Q2014. Page 1 of 14
The capital inflow for bond funds slid 33.10% to S$1,321.51 million, which accounted for 23.55% of the overall capital inflow. Meanwhile, bond funds recorded a capital outflow of S$1,680.48 million for 4Q2014, sliding 16.46% compared to last quarter. Mixed-asset funds capital inflow slid 22.97% from S$1,757.27 million in 3Q2014 to S$1,353.55 million in 4Q2014, which accounted for 24.12% of the overall capital inflow. The capital outflow of mixed-asset funds rallied 30.04% from S$730.87 million in 3Q2014 to S$950.39 million in 4Q2014. The total inflow of capital for 4Q2014 slid 20.13% from 3Q2014 s S$7,027.11 million to S$5,612.35 million, while the total outflow of capital in 4Q2014 fell 8.69% from S$6,035.54 million in 3Q2014 to S$5,511.13 million. Figure 1 Performance of Key Technical Indicators during 4Q 2014 Page 2 of 14
Table 2 Ten Top Fund Sector Inflow and Outflow by Lipper Global Classification for Q4 2014(S$ Million) Inflows Outflows Lipper Global Classification Fund Flow Lipper Global Classification Fund Flow 1 Money Market SGD 632.10 1 Money Market SGD 640.13 2 Bond Global 562.42 2 Bond Global 579.30 3 Mixed Asset USD Bal - US 464.73 3 Mixed Asset Other Flexible 469.59 4 Equity Asia Pacific Ex Japan 412.90 4 Equity Global 362.63 5 Equity Global 331.08 5 Equity Asia Pacific Ex Japan 318.46 6 Bond SGD 233.95 6 Bond USD High Yield 253.63 7 Mixed Asset SGD Balanced 230.79 7 Bond SGD 229.33 8 Mixed Asset EUR Bal - Global 225.39 8 Equity Japan 226.75 9 Mixed Asset USD Flex - Global 200.26 9 Equity Europe 210.20 10 Equity China 170.30 10 Bond Global High Yield 188.20 Note: Lipper Global Classifications are created only when there are a minimum of ten representative products with a similar investment mandate. Fund groupings not meeting this requirement will be categorised in an equivalent category where appropriate or placed in Other. 2. Equity Fund Flow Analysis Global equity markets continued fluctuating in Q4 2014. The MSCI World Index soared 1.12% (in U.S. dollar terms) in Q4 2014, while it slid 2.05% in Q3 2014. The NASDAQ, S&P 500 and Dow Jones Industrial soared 5.40%, 4.39% and 4.58%, respectively, in the period. Among key core European equity markets, only the Xetra DAX posted positive return of 3.50% in Q4 2014, while FTSE 100 and CAC 40 slid 0.86% and 3.25% in the period (all in local currencies). China was still the best performing Asia single market and China Shanghai Composite Index continued rallying 36.84% in Q4 2014. For all funds registered for sale in Singapore and contributed fund flows by participating IMAS members, 20 of the 63 LGC-(Lipper Global Classification) type equity fund groups posted a net capital inflow and 42 LGC-type equity fund groups posted net capital outflow in the quarter. Among all Equity types, Equity China and Equity Asia Pacific Ex Japan types gained the largest fund net inflows of S$97.77 and S$94.44 million, respectively, while Equity Europe posted the biggest outflow of S$111.12 million. Among all equity fund groups investing in all seven different regions and sectors, LGC-type equity fund groups that invest in Asia Pacific stopped bleeding and gained the biggest capital net inflow of S$96.14 million of equity funds, while Europe region turned the biggest net capital outflow of S$67.37 million for the period. Page 3 of 14
Table 3 Ten Top and Bottom Equity Fund Classification by Net Flow for Q4 2014(in S$ Million) Equity Sector Net Flows Equity China 97.77 Equity Asia Pacific Ex Japan 94.44 Equity Global Income 71.77 Equity Europe Income 43.86 Equity Emerging Mkts Global 37.62 Equity India 35.38 Equity Singapore 14.44 Equity Sector Healthcare 5.24 Equity Japan Income 3.54 Equity Emerging Mkts Europe 1.87 Equity Malaysia -7.63 Equity Greater China -7.98 Equity US -9.06 Equity Sector Information Tech -11.80 Equity Emerging Mkts Asia -16.10 Equity Thailand -18.94 Equity Global -31.56 Equity Asia Pacific Sm&Mid Cap -45.65 Equity Japan -65.04 Equity Europe -111.12 Table 4 Estimated Equity Fund Flow by Broad Geographical Classifications for Q4 2014(in S$ Million) Geographical Classification Asia-Pacific 96.14 Europe -67.37 Global 79.78 Latin America -0.54 North America -9.29 Middle East/Other -6.17 Sector -22.19 Total 70.36 The total net number is slightly different from table 1 for it doesn t include Alternatives which belongs to equity type. Page 4 of 14
3. Bond and Money Market Fund Flow Analysis The Citigroup WGBI slid 1.49% in the quarter (in USD). The ten-year Treasury ended at 2.174% for the third quarter versus 2.058% on the end of Q3 2014. There were 9 of 26 LGC (Lipper Global Classification)-type bond fund groups recorded a net capital inflow in 4Q2014. The top 3 leading LGC-type bond fund groups were: Bond Asia Pacific HC (+S$57.92 million), Bond EUR High Yield (+S$13.54 million) and Bond Europe(+S$10.78 million). As for money market funds, Money Market USD recorded a net inflow, while Money Market SGD posted a net outflow in the period. Table 5 Net Flow into Bond and Money Market Funds for Q4 2014(in S$ Million) Bond Funds Net Flows Money Market Funds Net Flows Bond Asia Pacific HC 57.92 Money Market SGD -8.03 Bond EUR High Yield 13.54 Money Market USD 7.09 Bond Europe 10.78 Bond Asia Pacific LC 5.80 Bond SGD 4.62 Bond Emrg Mkts Global LC 2.10 Bond USD Short Term 0.79 Bond Global Inflation Linked 0.47 Bond EUR Corporates 0.08 Bond Global Corporates -1.16 Bond Convertibles Global -1.84 Bond CNY -1.93 Bond Emerging Markets Other -2.63 Bond Europe High Yield -6.92 Bond Emerging Mkts Glb Corp -9.74 Bond USD Corporates -11.39 Bond Global -16.89 Bond Emrg Mkts Global HC -47.25 Bond Global High Yield -70.37 Bond USD -84.39 Bond USD High Yield -180.27 Total Bond Funds -339.95 Total Money Market Funds -0.95 The total net number is slightly different from table 1 for it doesn t include Alternatives which belongs to bond type. Page 5 of 14
4. Mixed-Asset Funds Flows Analysis Total net flow in asset-allocation products including mixed-asset funds and target maturity fund posted a positive flow of S$402.34 million in 4Q2014. The increase in the net capital inflow of this fund category was attributed mainly to mixed-asset balanced funds, which brought it to become the most popular asset type for the period. Table 6 Net Flow of Mixed-Asset and Other Funds for Q4 2014(S$ Million) Funds Net Flows Aggressive -4.62 Balanced 633.80 Flexible -314.28 Conservative 89.17 Target Maturity -1.73 Total Mixed-Asset 402.34 Absolute Return -18.38 Alternative -5.22 Commodity -6.01 Protected -0.98 Subtotal Other Assets -30.59 The total net number is slightly different from table 1 for it doesn t include Alternatives which belongs to Mixed-Assets type. Page 6 of 14
5. Outlook The oil prices have dropped by 60% to below $50 since July and are expected to remain around that level for some time. The drop has already had a negative impact on the employment prospects in the oil industry and has caused investor s anxiety. Moreover, in order to rescue the feeble state of the European economy and move away from deflation, the European Central Bank (ECB) announced a big programme of quantitative easing on January 22nd. It plans to spend 60 billion a month for at least 19 months, adding hefty purchases of government bonds to an existing scheme to buy covered bonds and asset-backed securities (currently around 10 billion-worth a month). It has triggered several central banks to race to lower interest rates to curb flooded hot money, while the U.S. Fed is standing out from the rest of the crowd because it s attempting to tighten its monetary policy this year. Global financial markets are becoming more and more volatile because of the big move for global hot money. Xav Feng xav.feng@thomsonreuters.com Thomson Reuters 2014. All Rights Reserved. Lipper FundFlows Insight Reports are for informational purposes only, and do not constitute investment advice or an offer to sell or the solicitation of an offer to buy any security of any entity in any jurisdiction. No guarantee is made that the information in this report is accurate or complete and no warranties are made with regard to the results to be obtained from its use. In addition, Lipper, a Thomson Reuters company, will not be liable for any loss or damage resulting from information obtained from Lipper or any of its affiliates. Page 7 of 14
6.1 Appendix A Data Sources Data and analyses are based on information provided by the following IMAS members: 1 Aberdeen Asset Management Asia Limited 2 Allianz Global Investors Singapore Limited 3 AllianceBernstein (Singapore) Ltd. 4 Amundi Singapore Limited 5 APS Asset Management Pte Ltd 6 Deutsche Asset Management (Asia) Limited 7 Eastspring Investments (Singapore) Limited 8 First State Investments (Singapore) 9 FIL Investment Management (Singapore) Limited 10 Henderson Global Investors (Singapore) Limited 11 ING Investment Management Asia Pacific (Singapore) Ltd 12 JPMorgan Asset Management (Singapore) Limited 13 Lion Global Investors Limited 14 Nikko Asset Management Asia Limited 15 Phillip Capital Management (S) Ltd 16 PineBridge Investments Singapore Limited 17 PIMCO Asia Pte Ltd 18 Schroder Investment Management (Singapore) Ltd 19 Singapore Consortium Investment Management Ltd 20 Singapore Unit Trusts Limited 21 Templeton Asset Management Ltd 22 UBS Global Asset Management (Singapore) Ltd 23 UOB Asset Management Ltd 24 Western Asset Management Company Pte Ltd Page 8 of 14
6.2 Appendix B Net Fund Flow by Lipper Global Classification for Q4 2014(S$ Million) Lipper Global Classification CPF Net Flow Non-CPF Net Flow Absolute Return Other -0.03-10.83 Absolute Return USD Low -3.68 Absolute Return USD Medium -3.84 Alternative Credit Focus -0.79 Alternative Global Macro -4.43 Bond Asia Pacific HC 57.92 Bond Asia Pacific LC -0.41 6.21 Bond CNY -1.93 Bond Convertibles Global -1.84 Bond Emerging Markets Other -2.63 Bond Emerging Mkts Glb Corp -9.74 Bond Emrg Mkts Global HC -47.25 Bond Emrg Mkts Global LC 2.10 Bond EUR -0.17 Bond EUR Corporates 0.08 Bond EUR High Yield 13.54 Bond Europe 10.78 Bond Europe High Yield -6.92 Bond GBP -0.05 Bond Global 0.00-16.89 Bond Global Corporates -1.16 Bond Global High Yield -70.37 Bond Global Inflation Linked 0.47 Bond Other Hedged -0.01-0.86 Bond SGD -0.27 4.89 Bond USD -84.39 Bond USD Corporates -11.39 Bond USD High Yield -180.27 Bond USD Mortgages -0.16 Bond USD Short Term 0.79 Commodity Agriculture -0.90 Commodity Blended -3.18 Commodity Precious Metals -1.93 Page 9 of 14
Equity ASEAN -0.54 3.40 Equity Asia Pacific -0.21 1.53 Equity Asia Pacific Ex Japan 1.47 92.97 Equity Asia Pacific Sm&Mid Cap -0.66-44.99 Equity Australasia -0.19 Equity Australia -0.51 Equity Brazil 0.42 Equity China -0.13 97.90 Equity Emerging Mkts Asia -0.26-15.84 Equity Emerging Mkts Europe -0.02 1.89 Equity Emerging Mkts Global -1.62 39.24 Equity Emerging Mkts Latin Am -0.96 Equity Emerging Mkts Other -0.63 Equity Emrg Mkts Glb Sm&Md Cap 0.90 Equity Europe -0.15-110.97 Equity Europe ex UK -0.02 Equity Europe Income 43.86 Equity Europe Sm&Mid Cap -0.24 Equity EuroZone -1.64 Equity France -0.06 Equity Frontier Markets 0.26 Equity Germany -0.59 Equity Global -1.31-30.25 Equity Global Income 1.59 70.17 Equity Global Sm&Mid Cap -0.58 1.64 Equity Greater China -1.38-6.60 Equity Hong Kong -0.04 1.38 Equity Iberia -0.13 Equity India -0.65 36.03 Equity Indonesia 0.49-3.79 Equity Italy -0.11 Equity Japan -1.24-63.80 Equity Japan Income 3.54 Equity Japan Sm&Mid Cap -0.11 Equity Korea -0.26-2.49 Equity Malaysia -0.09-7.54 Equity Malaysia/Singapore -0.28-3.09 Equity MENA -5.80 Equity Nordic -0.02 Equity Philippines -0.10 Page 10 of 14
Equity Russia 0.88 Equity Sector Biotechnology -0.28-6.20 Equity Sector Consumer Discret -0.45 Equity Sector Energy -0.10 Equity Sector Financials -0.03-1.15 Equity Sector Gold&Prec Metals -1.60 Equity Sector Healthcare -0.94 6.18 Equity Sector Information Tech -1.15-10.65 Equity Sector Materials -0.07 Equity Sector Real Est As Pac -0.33-0.69 Equity Sector Real Est Europe -0.10-0.99 Equity Sector Real Est Global -0.14-2.83 Equity Sector Telecom Srvcs -0.66 Equity Singapore -2.90 17.34 Equity Switzerland 0.01 Equity Taiwan -0.13-2.06 Equity Thailand -0.85-18.09 Equity UK -0.06 Equity US -2.77-6.30 Equity US Income -0.12 Equity US Small & Mid Cap -0.11 Equity Vietnam 18.91 Mixed Asset EUR Bal - Europe 1.25 Mixed Asset EUR Bal - EuroZone -0.50 Mixed Asset EUR Bal - Global 206.67 Mixed Asset Other Aggressive -0.70 Mixed Asset Other Balanced -8.67 Mixed Asset Other Conservative 0.00 Mixed Asset Other Flexible -0.05-467.96 Mixed Asset SGD Aggressive -0.06-2.49 Mixed Asset SGD Balanced -12.79 110.23 Mixed Asset SGD Conservative -0.02 89.19 Mixed Asset USD Aggressive -1.38 Mixed Asset USD Bal - Global -0.32 17.67 Mixed Asset USD Bal - US 320.28 Mixed Asset USD Flex - Global 153.72 Money Market SGD -8.03 Money Market USD 7.09 Protected -0.98 Page 11 of 14
6.3 Appendix C CPF Fund Flow by Lipper Global Classification for Q4 2014(S$ Million) Rank Lipper Global Classification CPF Inflow 1 Equity Asia Pacific Ex Japan 20.86 2 Equity US 10.15 3 Equity China 6.51 4 Equity Europe 4.27 5 Equity Global Income 3.99 6 Mixed Asset SGD Balanced 3.38 7 Equity Global 3.28 8 Equity Greater China 2.23 9 Equity Singapore 2.21 10 Equity Emerging Mkts Global 1.60 Rank Lipper Global Classification CPF Outflow 1 Equity Asia Pacific Ex Japan 19.40 2 Mixed Asset SGD Balanced 16.17 3 Equity US 12.92 4 Equity China 6.63 5 Equity Singapore 5.11 6 Equity Global 4.58 7 Equity Europe 4.41 8 Equity Greater China 3.61 9 Equity Emerging Mkts Global 3.22 10 Equity Global Income 2.40 Page 12 of 14