MAS EQDP: Manulife Investment Management launches Singapore all-cap fund strategy

[SINGAPORE] Manulife Investment Management said it will launch a fund strategy with an emphasis on Singapore small and mid-caps, shortly after it was appointed among a second batch of asset managers under the Equity Market Development Programme (EQDP).

On Wednesday (Dec 3), it said that about 40 per cent of its portfolio will be allocated to Singapore small and mid-cap companies, while maintaining “significant exposure” to large caps to ensure liquidity and scalability.

The asset manager will launch a Singapore All-Cap Equity strategy that is research-driven and “benchmark-unconstrained,” with stock selection as the “main source of long-term value”.

Chan Hock Fai, head of equities, Singapore, Manulife Investment Management, said: “We see tremendous opportunities in Singapore’s small and mid-cap space, which has historically been under-researched and overlooked.”

Manulife was appointed by the Monetary Authority of Singapore (MAS) on Nov 19 in a second batch of six asset managers under the EQDP. The other asset managers were Amova Asset Management, AR Capital, BlackRock, Eastspring Investments (Singapore) and Lion Global Investors (LGI).

This batch of asset managers will receive a total allocation of S$2.85 billion, reported The Business Times previously.

Unlike Manulife, batchmate LGI will deploy its EQDP allocation into its existing LionGlobal Singapore Trust Fund. It is not planning to launch any new funds.

The same strategy will be adopted for its trust fund, by allocating 60 to 70 per cent to large-cap stocks, and 30 to 40 per cent to mid caps.

The EQDP is a S$5 billion initiative to deepen investor engagement and enhance liquidity in Singapore’s equities market.

The MAS had announced its first batch of managers under the initiative on Jul 21. They are Fullerton Fund Management, JP Morgan Asset Management and Avanda Investment Management. A combined initial sum of S$1.1 billion was set aside for the three asset managers under the EQDP.

Fullerton’s Singapore Value-Up Fund will invest exclusively in Singapore-listed securities, spanning large mid, and small-cap stocks, initial public offerings and secondary listings. It is offered as a collective investment scheme to retail, accredited and institutional investors in Singapore and selected international markets.

Avanda’s Singapore equity strategy is built around three core investment themes: Value-Up, Local Champions and Turnaround. The portfolio will consist of between 25 and 35 core holdings, with about half of the holdings being mid-caps in the range of S$500 million to S$5 billion in market capitalisation. The remaining half will be mostly allocated to large cap names, with a lower allocation to small-cap counters.

Its fund, which is available only to accredited and institutional investors, targets an absolute return of up to 15 per cent over the next three to five years.

JP Morgan Asset Management’s fund strategy will focus on small- and mid-cap Singapore stocks, as well as high-yielding markets in the Asia-Pacific. It has yet to officially launch its fund.