Two more formidable competitors are entering Taiwan's crowded mutual fund market. Cathay Life Insurance (國泰?H1? and Fidelity Investment (富1F投資) have been granted permission to establish local securities investment trust ventures.
Cathay Life Insurance, the largest financial institution in Taiwan, plans to establish Cathay Securities Investment Trust (國泰投信), according to the Securities & Futures Commission (證期會). In addition, Fidelity Investment, the largest US mutual fund company, has plans to establish Fidelity SITC (富1F投信).
Industry analysts said Cathay Life Insurance, with over NT$800 billion in assets and the only financial institution in Taiwan ranked among the top 100 financial institutions worldwide, would pose a threat to the 32 fund companies currently in the market just by allocating a fraction of its assets to its new fund company.
Fidelity Investment, on the other hand, with more than US$600 billion in assets under its management worldwide, also constitutes a formidable presence.
The two new ventures could reshuffle the top 10 players list here in a matter of months.
Meanwhile, the successful launch of a balanced fund has made Capital Securities Investment Trust (群益投信) the third largest mutual fund company in Taiwan, next to China SITC (??華投信) and Yuanta SITC (??j投信).
The total assets of Taiwan's mutual fund industry at the end of last month increased 2.86 percent to NT$1.07 trillion after topping a record NT$1 trillion in October.
China SITC maintained its first place position in the mutual fund industry at the end of last month, with assets totalling NT$97.08 billion under its management, a slight decrease of 2.46 percent over the previous month. Yuanta SITC remained in second place with assets of NT$84.94 billion, according to Association of Securities Investment Trust and Advisory (投信投顧?蔆|).
Last month Capital SITC successfully launched its "Capital Asset Allocation Fund (群益真善美基金)," a balanced fund, raising NT$10 billion, the ceiling for the fund.
The total assets of Capital SITC reached NT$76.4 billion at the end of November, replacing National SITC (建弘投信) in the third place spot. Capital's 11 percent increase in assets was also the largest increase among the top 10 fund companies last month.
Chen Huei-der (3紡z德), the fund manager at Capital Asset Allocation Fund, was named by S&P Micropal "best fund manager of the year" while managing the Capital Marathon Fund (群益馬拉松基金), said Monica Liu (劉宜君), deputy manager at Capital SITC.
This was one reason Capital SITC's first balanced fund achieved record subscription volume.
Several other fund companies have been planning to launch similar products after Capital's success.
Since the fund has reached its ceiling of NT$10 billion, the firm is now applying for an increase from securities authorities, Liu said.
The fund is temporarily closed to new subscriptions pending the application's approval by authortities.
National SITC (建弘投信) was ranked fourth last month, with assets of NT$71.7 billion. Jardine Fleming SITC (怡富投信), with assets of NT$67.8 billion, took over the fifth place spot from Fubon SITC (富?投信) last month, according to the association.
There were 235 mutual funds at the end of last month, seven more than in the previous month.
Last month there was a 57 percent increase in balanced funds, from NT$15.5 billion to NT$24.35 billion.
This was the largest increase for any category.
The total assets of all domestic open-ended equity funds increased 7.23 percent to NT$219.54 billion.
The total assets of domestic bond funds decreased 0.35 percent to NT$696.66 billion, according to the association.
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