(China Alert) China public mutual fund 4Q15 AUM hits USD1.3tr

·China’s public mutual fund industry grew 25% QoQ
·Industry leaders were able to retain AUM with MMF strategies
·Structural change should continue into 2016

Update: These are certainly interesting times with great volatility at hand, volatility which would be expected to have had an enormous effect on China’s public mutual fund industry as much as anything else. The industry grew steadily regardless, to reach RMB8.3tr (USD1.3tr) in 4Q15. Key structural changes which fueled growth in 2015 will continue to define the industry this year: a distinction between MMF and non-MMF business models is increasingly apparent. As large as the 4Q15 figure is, it excludes the even bigger non-core segment: China’s mutual fund market is set to overtake Japan and Australia to become the largest in Asia. Z-Ben Advisors estimates that changes at both the firm and industry level should drive domestic public mutual fund AUM growth, with the potential of it reaching up to RMB10tr by the end 2016.

The quarterly jump in AUM goes far beyond the traditional end of year window dressing and has its roots in the structural maturation of the industry. A certain proportion of the 25% growth can be attributed to……

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