We discuss with Elsie Chan, Head of Intermediaries, Asia ex Japan, T. Rowe Price, on what makes a great asset manager.
Germaine Share: Hi. I am Germaine for Morningstar’s manager research team. And we have with us today Elsie Chan, Head of Intermediaries for Asia ex Japan at T. Rowe Price. T. Rowe Price won our Best Equity Fund House award at the Morningstar Award 2018. And we are very happy to have Elsie here today, to talk about what makes a great asset manager.
Hi Elsie. Thanks for joining us today.
Elsie Chan: Thanks, Germaine.
Share: So, maybe we could dive right in. Can you share with us what are the key drivers for T. Rowe Price’s success?
Chan: OK, sure. It’s an honor for us to receive this award. Thank you very much. I think, to talk about our firm as an asset manager, I think we have to talk about our fundamental research. Investment excellence is such a key focus for us. Obviously, having very experienced, high-caliber investment professionals is key for us. So for example, in equities, we have over 300 investment professionals doing fundamental research on companies, which is a really important thing. So for us, for example, the investment analysts, they play very important role, they are industry experts in the area, they are not people who can only talk to Wall Street people per se, they can talk to people in the industry in-depth, and really have a very in-depth understanding of that particular industry.
I would also like to say the culture of the firm is very important. I think we have a very stable collaborative culture within T. Rowe Price, where you know, we really value diverse opinions and for people to really debate and challenge one another. I think that’s how you have investment excellence. We also have very stable people staying at the firm. People want to stay in our firm for a very long time. For example, our PMs are very experienced, the average investment experience for our PMs is 21 years, and average tenure at our firm is 16 years. So we do have generation after generation of people staying with us and deliver long-term performances.
Share: I think you brought up a great point about, you know, encouraging a stable team and that fostering investment excellence. Can you maybe share some insight on how T. Rowe Price built a great team?
Chan: I think we tend to look for people who are team players. So that’s the starting point. Not just people who are very good at what they do, but people who can work in a team, in a collaborative constructive way. I think that’s key. And then setting that culture at the top is very important. I think, for our senior managers to really set that culture, and then for the rest of the organization to follow, is important. The other thing I would mention is putting our clients first, that is obviously a key focus for our firm and everyone in the firm understands that.
Share: Great. I think that’s very aligned with Morningstar’s value in terms of putting investors first as well. So I want to switch gears a little bit. I want to check in with you, what is your outlook for the coming year and how’s T. Rowe Price positioned to fill some of the investors’ needs that you are seeing?
Chan: OK, sure. I think we have seen some volatility recently in the market. In general, we feel that there’s still going to be broad base recovery in the market. Obviously, there are uncertainties, for example, you know, the cost of US inflation, or raising rates, how these things are going to affect general markets, will cause certain volatility. But at the end of the day, for us, going back to my earliest point, is doing that fundamental research. And I think our founder Thomas Rowe Price said that, change is pretty much the constant for our investors. There is always gonna be change. But how do you take advantage and understand the implications of the change, you know, maybe identifying some of the beneficiaries of the change, that’s important.
Share: Sure. Just rounding up our discussion here, is T. Rowe Price planning to bring any new products to Asia? And what is the thinking when you do decide to bring something new to the market?
Chan: Sure. We are constantly thinking about offering different products to investors. We currently have 10 registered funds in Hong Kong. We are looking to register more funds to offer the retail clients in Hong Kong. So that’s definitely something we look at constantly. We have actually been in Hong Kong since 1987. And we focus a lot on investments. And I think in recent years, we are doing more on the marketing, brand building side. And we will also continue to do that; and offering diverse products for investors.
Share: Just one follow-up question from there. Can you share with us some of the asset classes that fall into your initiatives?
Chan: Sure. We are looking at mainly equity, fixed income, and the multi-asset classes.
Share: Great. With that, I’d like to thank you, Elsie, for joining us today.
Chan: Thanks very much, Germaine.
View all Morningstar Hong Kong Fund Awards 2018 articles here.
