A decision by Advance Funds Management to change the underlying investment manager of its Advance Asian Equities Fund has prompted Standard & Poor’s to place the fund ‘on hold’.
The ratings house said this week that Advance had terminated its investment management agreement with Maple-Brown Abbot and announced that the ceding manager would be Lion Global Investors, one of the largest asset management companies in South-East Asia and part of the Overseas Chinese Bank.
S&P said Advance believed that a local manager was best placed to invest in the region, as Asian markets and companies were heavily influenced by regional factors such as culture, politics and cross-border relations.
“Lion’s value-style investment philosophy is similar to that of Maple-Brown Abbot and uses bottom-up research to identify companies that have strong fundamentals,” S&P fund analyst Justine Gorman said. “It buys these companies when they are trading at a discount to fair value.”
She said that S&P would be reviewing the ‘on hold’ rating once it had reviewed the new manager’s capabilities.
S&P had previously rated the fund four stars.
