Dear readers,

With aggressive rate hikes, banking crises, and intensifying geopolitical tensions in the Middle East, 2023 had proven to be a challenging investing landscape that fund managers had to navigate.

The persistent uncertainty surrounding monetary policy seems to be one of the defining features of the year, as central banks around the world grappled with the task of managing inflationary pressure while supporting economic growth. The prospect of interest rate hikes loomed large, prompting fluctuations in bond yields and equity valuations as investors adjusted their expectations for borrowing costs.

Throughout the first half of the year, Silicon Valley Bank’s collapse as well as the subsequent shutdown of Signature Bank raised major concerns in the banking system. This led to a ripple effect as investors sought to reduce exposure to similar institutions.

The year also saw escalating trade disputes, especially between the US and China, ongoing Russo-Ukrainian war and the spark of conflict in the Middle East. These injected doses of volatility in the markets, as investors faced the implications of shifting geopolitical dynamics on global trade, supply chains and economic growth prospects.

See also: PIMCO emerges as top winner with four winning funds across fixed income securities

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Meanwhile, technological innovation continued to disrupt cushy traditional industries and reshape business models, presenting both opportunities and challenges for investors. Companies at the forefront, particularly in areas such as artificial intelligence, blockchain and renewable energy attracted significant investor interest, while traditional incumbents faced pressure to adapt.

Amid this backdrop, The Edge Singapore believes that recognising top performers encourages continuous improvement, aside from helping to drive the industry towards greater transparency, accountability and investor-centric practices. Together with our knowledge partner Morningstar, we are happy to launch the inaugural edition of Best Funds Awards.

Speaking to the fund managers for this supplement, there are several key themes that we identify moving forward. First, more than ever, active asset management is relevant. Amid the volatile market, active management allows managers to swiftly adapt to market conditions, enabling them to capitalise on opportunities and mitigate risks. This is especially on the back of rigorous research and analysis-driven investment selection.

There is also a continued focus on sustainability. Although some market observers may perceive environmental, social and governance considerations as “out of fashion” or “losing steam”, it still underpins fund managers’ decision-making process as we all recognise there are multiple, bigger goals than just beating the benchmark.

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As such we are seeing more funds to help prove that prioritising sustainability can not only mitigate risk but also enhance returns while contributing to a more resilient economy for generations to come.

Lastly, fund managers are increasingly embracing the use of new tools and technologies to enhance their investment processes. Leveraging advanced analytics, algorithms, data visualisation tools and risk management software, fund managers can reduce the guesswork and make more informed decisions as well as optimise portfolios, among others.

Looking ahead, we hope Singapore’s fund management industry continues to thrive despite the decline in assets under management seen in recent years.

A flourishing fund management industry can enhance competitiveness, provide investors with ample diversification opportunities as well as contribute to the country’s overall financial ecosystem.

According to the Monetary Authority of Singapore, the country saw constant interest from global and regional asset managers seeking to establish offices here to tap new opportunities. As at December 2022, the number of licensed and registered fund management companies in the country increased to 1,194 from 1,108 recorded in the previous year. Singapore, as a whole, has an asset management base of $4.9 trillion –– certainly not a trifling amount.

And of course, more than ever, we all need multiple ways and means to grow our own pool of wealth – and entrusting part of this to professional managers is a tried-and-tested way.

Hearty congratulations to all the winners!

Khairani Afifi Noordin
Assistant Editor, The Edge Singapore

Click here for the full list of funds that won at the Best Funds Awards 2024.