A Trending Universe in Q3 2023:
ONSHORE CHINA A-SHARES EQUITY
Breaking down insights from Nasdaq eVestment™'s latest Institutional Intelligence Report:
What is a trending universe?
Trending universes are Nasdaq eVestment primary strategy universes which were among the 100 most important to investors and consultants in the current quarter, measured by absolute flow and viewership rankings, and experienced the largest changes in investor sentiment, measured by viewership capture and win-rate change.
Onshore China A-Shares Equity
Allocations to this universe as illustrated by win-rates fell off a cliff in Q2 2023 along with product profile views. The universe had the most negatively trending metrics in last quarter’s report and the nearly $2bn in net outflow in Q3 2023 was almost exactly the level seen in Q2. Looking at product-level net flows one would see that the last two quarters’ outflows are a result of virtually no net new money coming in along with meaningful, but not large net outflows. The bottom line here is that investors have paused on new allocations to this universe and redemptions continue, but not at a level that is notably larger than prior periods.
Both the universe’s largest reported asset bases, Asia ex-Japan and Europe ex-UK, accounted for net outflows in Q3, but investors in the US showed little net flow in either direction and they did increase their viewership to the strategy during the quarter. Investors in Australia did the same and reported data on those investors show slight net inflows from down under.
It is also worth noting that one of the fastest growing primary universes in terms of product development is the Emerging Markets ex-China universe of which more than 70% of the universe’s products have launched within the last three years.
Win-rates over time illustrate the change in the breadth of capital raising success while viewership capture highlights investor and consultant interest in digging into product details. The two metrics together put the current quarter’s trend in context.
The full report highlights how different Nasdaq eVestment solutions can enable users to understand key metrics about their universe, including which products are capturing a rising or falling proportion of product views (table below), the investors and consultants in which regions are driving that viewership, and which of your peers are seeing the universe’s largest net asset flows.
| Products of Rising Interest | Products of Falling Interest |
|---|---|
| JPM China A Shares | Franklin Sealand China A Share |
| EARNEST China A-Share | AllianzGI China A-Shares Equity |
| Rosefinch 1 | Green Court China A-Share Equity Strategy |
| Goldman Sachs China A-Shares Equity | Cephei Capital China Total Return Fund |
| APS China A Share Strategy | BlackRock Systematic China Opportunities |
Below left are key metrics about the universe which give a sense of its current state and factors that may define its institutional sentiment. The matrix (below right) illustrates where the universe’s largest pools of assets reside (bubble size), the region’s recent impact on net flows (vertical axis) and how much more or less of the universe’s viewership they accounted for in the current quarter compared to the prior year. The goal is to show the regional drivers of current universe sentiment.
| Universe Key Metrics ($mm)* | |
|---|---|
| Institutional Assets: | $19,935.24 |
| Inst'l Market Share: | .07% |
| Reporting Managers: | 76 |
| Active Products: | 105 |
| Most Common Stated SMA Fee @ $50mm: | 100 |
| Asset Concentration: | 57% |
| Inst'l Net Flow in Quarter: | -$1,860.55 |
| Prior Year Net Inst'l Flow: | -$1,860.68 |
| Sum of Net Inflows: | $305.87 |
| Market Share of Inst'l Inflow: | 0.06% |
| Sum of Net Outflows: | -$2,166.42 |
| Market Share of Inst'l Outflow: | 0.30% |
| Win-Rate in Quarter: | 33% |
| Prior Year Win-Rate: | 42% |
| Views in Quarter: | 595 |
| Share of Views: | 0.38% |
| % Of Products Viewed In Q | 70% |
| Avg. % of Products Viewed Prior 4Q's: | 77% |
