SET to launch mutual fund trading pool early next year
Jan 11, 2016 8:39:34 GMT 7
realisedurgency likes this
Post by Fletchsmile on Jan 11, 2016 8:39:34 GMT 7
This would be useful.
Also interesting stats on the growth of mutual fund accounts. The Thai stock market will face challenges in coming years, one of the positive factors though is the scope for new investors, including via mutual funds, as the number of people who have exposure to the stock market is way below developed markets. So if they can find ways to tap new demand...
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SET to launch mutual fund trading pool early next year
Published: 11/01/2016 at 04:30 AM
Newspaper section: Business
The Stock Exchange of Thailand (SET) plans to introduce a trading platform that pools all mutual funds in one place by early 2017 to standardise asset management firms' trading systems and give investors easier access.
The pooled trading system, called FundNet, was approved by the SET's board of governors last month and will take a year to develop, said Kitti Sutthiatthasil, head of the strategy department at the bourse.
FundNet may start by offering basic mutual funds with bonds and equities and introduce more complex products such as foreign investment funds later.
The mutual fund business in Thailand has grown at a fast clip since the last financial crisis. The percentage of mutual fund accounts surged to 5.25% of total deposits in June 2015 from 1.58% in 2006.
The industry's assets under management (AUM) reached 3 trillion baht in the third quarter of 2015, compared with 1.12 trillion in 2008.
Mr Kitti said cut-off time, purchase orders and statement issuance must be standardised to accommodate the new trading system.
SET executive vice-president Pakorn Peetathawatchai said the pool of mutual funds would let sales agents compare all funds easily and save customers the cost of money transfer.
With a level playing field in the mutual fund industry, a company that is not a unit of a bank can compete with larger rivals.
According to data from the Association of Investment Management Companies, Thailand has 21 asset management firms, of which more than half are under a bank's umbrella, seven are owned by brokers or insurance companies, and a few are stand-alone mutual fund companies.
The top five mutual fund firms are units of banks, giving them a distribution advantage.
"Our challenge is that each fund management company has a different trading system, so we are talking with the Securities and Exchange Commission to standardise the industry's systems," Mr Pakorn said.
He cited South Korea, Luxembourg and the US as countries that use pooled trading systems for mutual funds.
In South Korea, where FundNet started in 2004, mutual fund trading value grew to US$26.3 billion in 2014 from $324 million a decade earlier.The country has 55 mutual fund management companies. Their AUM grew to $381 billion at the end of November 2015 from $345 billion in 2014.
South Korea will pool its provident funds in 2016 as a second step for FundNet. Korea Securities Depository handles back-office operations for mutual fund and provident business.
www.bangkokpost.com/business/finance/822600/set-to-launch-mutual-fund-trading-pool-early-next-year
Also interesting stats on the growth of mutual fund accounts. The Thai stock market will face challenges in coming years, one of the positive factors though is the scope for new investors, including via mutual funds, as the number of people who have exposure to the stock market is way below developed markets. So if they can find ways to tap new demand...
======================================
SET to launch mutual fund trading pool early next year
Published: 11/01/2016 at 04:30 AM
Newspaper section: Business
The Stock Exchange of Thailand (SET) plans to introduce a trading platform that pools all mutual funds in one place by early 2017 to standardise asset management firms' trading systems and give investors easier access.
The pooled trading system, called FundNet, was approved by the SET's board of governors last month and will take a year to develop, said Kitti Sutthiatthasil, head of the strategy department at the bourse.
FundNet may start by offering basic mutual funds with bonds and equities and introduce more complex products such as foreign investment funds later.
The mutual fund business in Thailand has grown at a fast clip since the last financial crisis. The percentage of mutual fund accounts surged to 5.25% of total deposits in June 2015 from 1.58% in 2006.
The industry's assets under management (AUM) reached 3 trillion baht in the third quarter of 2015, compared with 1.12 trillion in 2008.
Mr Kitti said cut-off time, purchase orders and statement issuance must be standardised to accommodate the new trading system.
SET executive vice-president Pakorn Peetathawatchai said the pool of mutual funds would let sales agents compare all funds easily and save customers the cost of money transfer.
With a level playing field in the mutual fund industry, a company that is not a unit of a bank can compete with larger rivals.
According to data from the Association of Investment Management Companies, Thailand has 21 asset management firms, of which more than half are under a bank's umbrella, seven are owned by brokers or insurance companies, and a few are stand-alone mutual fund companies.
The top five mutual fund firms are units of banks, giving them a distribution advantage.
"Our challenge is that each fund management company has a different trading system, so we are talking with the Securities and Exchange Commission to standardise the industry's systems," Mr Pakorn said.
He cited South Korea, Luxembourg and the US as countries that use pooled trading systems for mutual funds.
In South Korea, where FundNet started in 2004, mutual fund trading value grew to US$26.3 billion in 2014 from $324 million a decade earlier.The country has 55 mutual fund management companies. Their AUM grew to $381 billion at the end of November 2015 from $345 billion in 2014.
South Korea will pool its provident funds in 2016 as a second step for FundNet. Korea Securities Depository handles back-office operations for mutual fund and provident business.
www.bangkokpost.com/business/finance/822600/set-to-launch-mutual-fund-trading-pool-early-next-year
