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Hong Kong: Many Local Investment Funds Came Up Short For Investors in 2000

Mary Swire, Tax-news.com, Hong Kong

13 February 2001

According to Watson Wyatt Worldwide, a global financial consulting firm, last year many local investment funds came up short for investors in Hong Kong with the median return of funds (which replied to a measurement of Investment Performance (MIP) survey) at minus 2.1 per cent. In the previous year the same funds recorded a median return of 30.7 per cent.
Highlighted in the South China Morning Post this week, the findings of Watson Wyatt's survey, which is performed every quarter, blamed the funds' poor perfomance on the current weak nature and vulnerability of the global equity markets.

The report illustrated two crucial factors that have damaged the markets. Firstly, 'poor sentiment,' which is particularly infectious in the United States at the moment, towards the telecommunications, media and technology sectors. Secondly, the report raised concerns over slowing economies and recently disappointing corporate income.

Through the survey Watson Wyatt discovered that the proportion of assets invested by funds had leaned away from equities towards bonds, which had overall returned a positive growth in the last quarter of 2000.

The MIP survey concluded that the award for the worst fund performance will go to Rothschild Asset Management Funds which gave investors a negative return of 25.2 per cent. The survey forecasts that the Principal Insurance Company (Hong Kong) is likely to give the best return from last year with a positive 3.4 per cent.

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