TMBAM ES continues to focus on foreign funds

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TMBAM Eastspring (TMBAM ES) continues focusing on foreign investment funds (FIFs) this year as the investment units record the fastest growth among all types of funds in the mutual fund industry, giving the highest returns in 2020.

Mr Adisorn suggests investors plan for long-term investment.

FIFs are expected to attract more investors in the future, with investors paying record-high interest in the funds now.

TMBAM ES’s chief executive Adisorn Sermchaiwong said FIFs recorded the highest growth among other types of funds last year while its net asset value (NAV) grew by 12% to 490 billion baht.

The mutual fund industry only grew about 3% at the end of December 2020 with an NAV of about 4 trillion baht.

From FIFs’ total NAV of 490 billion baht, 115 billion baht was the net inflows in 2020.

TMBAM ES and Thanachart Fund Eastspring, the two asset management firms under Eastspring Investments, recorded combined net inflows from FIFs at 48 billion baht or 43% of total NAV.

The two firms account for 23% of the market share in FIFs, ranking first among firms in the industry, said Mr Adisorn.

He said investors who invested in TMBAM ES and Thanachart Fund Eastspring’s FIFs received at least 50-60% returns in the second half of 2020, while returns from Thai stocks at that time plunged almost 40% with a five-year average return of 20%.

He said Thailand’s GDP this year is expected to grow by only 2.5%, while some other Asian countries such as China are expected to see stronger growth of 7-8%.

As GDP grow, returns from stocks in these countries are expected to grow exponentially as well.

He said investors need to plan for long-term investment and make sure they have enough savings to spend during retirement and investment in foreign securities would give investors opportunities to capture better returns.

Investors should allocate some weight in their portfolios to FIFs in order to reap benefits from the trend, he said.

“We have to keep FIFs the industry’s champion. We intend to lead Thai investors to become global citizens with global portfolios and global opportunities,” Mr Adisorn said.

He said Eastspring Investment plans to merge TMBAM Eastspring and Thanachat Fund Eastspring within the second half and name the new company Eastspring Thailand which is to be officially announced again after the Ministry of Finance approves the merger plan.

Total assets under management (AUM) of both firms was 430 billion baht at the end of 2020 with a market share of 8%.

“We expect to increase the AUM of the two companies by 100 billion baht this year with an aim of reaching 1 trillion baht by 2025,” he said.

Mr Adisorn said the closure of the four fixed-income funds during the pandemic in March 2020 cost the firm outflows of around 200 billion baht.

As of February 2021, the firm has gradually paid 80% of principal and returns to investors.