Asian Capabilities

HSBC Asset Management’s Asia ex-Japan equity franchise operates under a diverse global equity platform with dynamic, bottom-up-style investment teams possessing local and specialist knowledge. We are committed to delivering high-conviction strategies focused on long-term performance and sustainable growth.

Our philosophy

We believe that Asian stock markets are inefficient, driven by short-term noise and sentiment. We seek to generate alpha by investing in companies aligned with secular growth trends that should drive significant and persistent growth over a multi-year horizon.

Our process

• The Asia ex-Japan Equity strategy is a large-cap-focused high-conviction strategy, with a bottom-up approach and a focus to invest in companies aligned with secular growth trends, which have yet to be discounted in valuation
• We aim to control unwanted macro and style risk exposures through a laser focus on portfolio construction, with returns expected to originate primarily from stock selection. This is especially important in volatile markets – we apply proprietary models to control our factor exposures and macro sensitivity such that majority of the risk of the portfolio is idiosyncratic and which is within our control
• The strategy employs continuous monitoring/reassessment of risk at the stock and portfolio level

HSBC strengths

• HSBC enjoys over 40 years of heritage and track record as an active manager in Asian equities
• We draw on the strong depth and breadth of resources dedicated to Asian equities through our local presence in our network of Asian markets within a globally connected investment network for additional perspectives
• We benefit from the goodwill and strong relationships that come with being a part of the HSBC Group and our strong insight into client needs through on-the-ground presence

HSBC Asset Management’s Chinese Equity strategy operates under a diverse global equity platform with dynamic, bottom-up-style investment teams possessing local and specialist knowledge. We are committed to delivering high-conviction strategies focused on long-term performance and sustainable growth.

Our philosophy

Our investment process for the Chinese Equity strategy focuses on bottom-up fundamental research within a quality growth framework. We aim to invest in companies that trade at a reasonable price and provide high-quality growth, believing that if the growth is sustainable, their stocks should deliver returns in line with or beyond their earnings growth and potentially outperform the market throughout business cycles

Our process

• The strategy employs a disciplined and repeatable investment process. Bottom-up selected quality growth stocks are structurally classified into three growth categories depending on their stage of development, namely compounders, accelerators and turnarounds
• We have a macro overlay with a flexible approach to sector, style, cash level, China A-shares’ weighting allocation and non-benchmark selections, which enables us to adapt to the unique nature of the Chinese equity market and navigate different market cycles
• Our robust risk management process potentially optimises returns in volatile markets while maintaining diversification

HSBC strengths

• The strategy has been actively investing in Chinese equities through various market cycles since 1992
• We have a diversified and empowered investment team embracing a broad range of age, cultural and educational backgrounds. The investment team in Hong Kong collaborates with the investment professionals in our Shanghai-based joint venture, HSBC Jintrust Fund Management Company Limited, for idea exchange
• We benefit from the goodwill and strong relationships that come with being a part of the HSBC Group and our strong insight into client needs through on-the-ground presence

HSBC Asset Management’s India equity franchise operates under a diverse global equity platform with dynamic, bottom-up-style investment teams possessing local and specialist knowledge. We are committed to delivering high-conviction strategies focused on long-term performance and sustainable growth.

Our philosophy

Our investment process for the India Equity strategy focuses on bottom-up fundamental research with the aim to invest in companies that are capable of generating returns above their cost of capital over the full business cycle and trade at a reasonable price..

Our process

• The India Equity strategy is a high-conviction strategy, with a bottom-up approach and a focus to invest in companies aligned with secular growth trends, which have yet to be discounted in valuation
• We aim to control unwanted macro and style risk exposures through a laser focus on portfolio construction, with returns expected to originate primarily from stock selection. This is especially important in volatile markets – we apply proprietary models to control our factor exposures and macro sensitivity such that majority of the risk of the portfolio is idiosyncratic and which is within our control
• The strategy employs continuous monitoring/reassessment of risk at the stock and portfolio level

HSBC strengths

• HSBC is one of the few international asset managers with continuous onshore presence in India since 2002
• We draw on the strong depth and breadth of resources dedicated to India equities, including onshore and offshore investment professionals, and leverage our globally connected investment network for additional perspectives. Our unique local to global model with deep understanding on the ground is key to deliver long term alpha for our clients
• We benefit from the goodwill and strong relationships that come with being a part of the HSBC Group and our strong insight into client needs through on-the-ground presence

The strategy invests primarily in Asian bonds denominated in US dollars.

Our philosophy

• We believe that the inefficiencies of the Asian fixed income market can be identified by the careful and disciplined analysis of Asian economic and industry cycles, as well as individual issuers and issues
• We believe that by understanding the management style and culture of Asian businesses and institutions, while identifying local supply and demand dynamics, we can manage unique investment risks to take full advantage of the opportunity set
• We believe that by combining these local insights together with a truly global perspective, we can construct portfolios in a risk-controlled framework, which can potentially deliver optimal risk-adjusted returns for our clients

Our process

• Our process is active, fundamental and value driven. It uses quantitative inputs on a selective basis and combines qualitative top-down analysis of macroeconomic and market dynamics, with structured bottom-up research into individual bond issuers and fixed income securities
• Leveraging the local insight from our investment professionals across the Asia-Pacific region, the team seeks multiple, uncorrelated alpha sources, with the aim of providing good risk-adjusted returns
• We have a stable and well-resourced team with investment professionals and credit research analysts based in five offices across Asia

HSBC strengths

• We have been managing Asian fixed income for three decades and manage one of the longest running Asia credit funds in the market
• Our team benefits from our global credit research platform, which utilises the expertise of seasoned sector specialists across the world
• While investment decisions are taken locally to ensure focus and accountability, our portfolio managers in Asia are able to access the expertise and experience of our investment professionals worldwide in order to gain a truly global perspective
• We benefit from the goodwill and strong relationships that come with being a part of the HSBC Group and our strong insight into client needs through on-the-ground presence

The strategy aims to achieve a higher level of income and capital appreciation through investing primarily in a diversified portfolio of higher yielding Asian fixed income securities that are USD denominated.

Our philosophy

• We believe that the inefficiencies of the Asian fixed income market can be identified by the careful and disciplined analysis of Asian economic and industry cycles, as well as individual issuers and issues
• We believe that by understanding the management style and culture of Asian businesses and institutions, while identifying local supply and demand dynamics, we can manage unique investment risks to take full advantage of the opportunity set
• We believe that by combining these local insights together with a truly global perspective, we can construct portfolios in a risk-controlled framework, which can potentially deliver optimal risk-adjusted returns for our clients

Our process

• Our process is active, fundamental and value driven. It uses quantitative inputs on a selective basis and combines qualitative top-down analysis of macroeconomic and market dynamics, with structured bottom-up research into individual bond issuers and fixed income securities
• Leveraging the local insight from our investment professionals across the Asia-Pacific region, the team seeks multiple, uncorrelated alpha sources, with the aim of providing good risk-adjusted returns
• We have a stable and well-resourced team with investment professionals and credit research analysts based in five offices across Asia

HSBC strengths

• We have been managing Asian fixed income for three decades and manage one of the longest running Asia credit funds in the market
• Our team benefits from our global credit research platform, which utilises the expertise of seasoned sector specialists across the world
• While investment decisions are taken locally to ensure focus and accountability, our portfolio managers in Asia are able to access the expertise and experience of our investment professionals worldwide in order to gain a truly global perspective
• We benefit from the goodwill and strong relationships that come with being a part of the HSBC Group and our strong insight into client needs through on-the-ground presence

The strategy seeks opportunities in both the onshore and offshore Indian bond markets, including investment grade, high yield and non-rated Indian fixed income securities denominated in INR and other currencies hedged back into INR.

Our philosophy

• We believe that by combining the opportunity sets in the Indian fixed income market, we are able to produce optimal risk-adjusted returns over the medium to long term
• We believe that the inefficiencies of the Indian fixed income market can be identified by the careful and disciplined analysis of its local economic and industry cycles, as well as individual issuers and issues

Our process

• Our India Fixed Income investment process is active, fundamental and value driven. It combines qualitative top-down analysis of macroeconomic and market dynamics, with structured bottom-up research into individual bond issuers and fixed income securities. The team seeks to exploit multiple, uncorrelated return sources to produce good risk adjusted returns independent of market cycles
• Portfolio managers in Singapore and Hong Kong have significant experience both in India and Asia fixed income and are supported by HSBC Asset Management’s global fixed income platform. They are also supported by considerable fixed income investment resources domestically in India

HSBC strengths

• We have been managing Asian fixed income through various market cycles for three decades
• Our team benefits from our global credit research platform, which utilises the expertise of seasoned sector specialists across the world
• While investment decisions are taken locally to ensure focus and accountability, our portfolio managers in Asia are able to access the expertise and experience of our investment professionals worldwide in order to gain a truly global perspective
• We benefit from the goodwill and strong relationships that come with being a part of the HSBC Group and our strong insight into client needs through on-the-ground presence

Our All China fixed income strategy aims to provide long term capital growth and income by investing in onshore RMB denominated fixed income securities and offshore RMB and China USD fixed income securities.

Our philosophy

We believe RMB fixed income markets are developing and inefficient. Through a focused and disciplined investment process, we can identify investment opportunities arising from these inefficiencies to deliver optimal risk-adjusted returns

Our process

• We apply an investment style that includes top-down macro analysis and bottom-up credit research. Chinese bond markets are fast developing but remain under-researched, creating opportunities to add value through proprietary research. This involves intensive credit research and a thorough analysis of the RMB bond market
• Leveraging the local insight from our investment professionals across the Asia region, the team seeks multiple, uncorrelated alpha sources, with the aim of providing good risk-adjusted returns
• We have a stable and well-resourced team with investment professionals and credit research analysts based in five offices across Asia

HSBC strengths

• Our investment team is equipped with in-depth local insights and supported by an integrated team of Chinese bond investment professionals based in Shanghai
• Our team benefits from our global credit research platform, which utilises the expertise of seasoned sector specialists across the world
• We benefit from the goodwill and strong relationships that come with being a part of the HSBC Group and our strong insight into client needs through on-the-ground presence

The Asia multi-asset strategy aims to invest in a diversified portfolio of equities, fixed income and other instruments related to the Asia Pacific region.

Our philosophy

• We believe financial markets are inefficient over the short and medium term. Asset class returns and risks are variable over time
• We think that price fluctuations generate opportunities which can be identified through the analysis of common factors (value, macro, trend and risk indicators) across asset classes

Our process

• We focus on delivering strong risk-adjusted returns thanks to dynamic asset allocation and disciplined portfolio construction based on proprietary portfolio optimisation and risk budgeting
• Our investment process is designed to capture all dimensions of diversification. Beta diversification is managed across asset classes and investment styles while alpha diversification is obtained thanks to our granular approach to asset allocation per market segments
• Our investment approach relies on extensive research resources and robust quantitative inputs

HSBC strengths

• We have built and nurtured a team-based approach promoting our investment process rather than individuals
• Our multi-asset platform promotes a common culture through constant dialogue and collaboration, within the team and with all the teams we interact with
• We have a repeatable investment process that combines quantitative and qualitative inputs in a considered way