Singapore’s UOBAM set to enter Taiwan active ETF market

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Singapore’s UOB Asset Management is the latest manager to signal its intent to join Taiwan’s active exchange traded fund market after the regulator said earlier this year it would invite applications.

Thio Boon Kiat, group chief executive for UOBAM, confirmed to Ignites Asia that the firm was gearing up to launch an active ETF in the Taiwanese market this year.

Taiwan opened its door to active ETF applications in January as part of plans to diversify its booming ETF sector, which is dominated by passive bond products.

At least 18 asset managers are preparing to enter the active ETF space, including Japanese fund giant Nomura Asset Management, which is preparing to launch the market’s first active ETF in May.

US asset manager AllianceBernstein and Taiwanese fund house KGI Securities Investment Trust have also filed applications to launch active ETFs. Fubon Asset Management and Cathay Securities Investment Trust plan to launch at least four such funds in 2025.

Foreign asset managers might hope to bring in global strategies in an active ETF wrapper for Taiwanese investors to gain advantages over domestic rivals in the market.

But UOBAM’s Thio, who declined to give specifics on what kind of strategy the fund firm would be rolling out, did not see a notable shift in Taiwan investor appetite for global assets.

“I won’t begrudge the fact that the global managers have the expertise,” he said. “But the [investor] need is what’s important.”

Last year, there was no need for Taiwanese investors to invest globally because Taiwan markets were booming, and local investors were “still confident” in their own markets, he noted.

Assets in Taiwan’s locally listed ETFs grew by 55 per cent last year to $195.99bn, accounting for 66.1 per cent of all onshore public funds assets.

Singapore’s UOB AM is currently one of just three offshore fund houses to have locally listed ETFs in Taiwan, along with Nomura Asset Management and Franklin Templeton via its local joint venture company.

Shifting investor sentiment on China, as well as uncertainty around US markets, is also reviving interest in the stagnant Singapore-China ETF cross-listing scheme.

UOBAM is in talks with its Chinese joint venture partner Ping An Fund Management to cross-list a China-focused ETF on the Singapore exchange this year, more than two years after launching its first such fund under the initiative in November 2022.

Just eight ETFs have been rolled out as part of the master-feeder scheme linking Singapore and Chinese exchanges since it kicked off at the end of 2021, with the latest launched by China Merchants Fund Management and Lion Global Investors in December last year.