Small investment scheme offers new asset management options: TWSE

2017/03/17 14:43:53 fontsize-small fontsize-default fontsize-big
Small investment scheme offers new asset management options: TWSE

Taipei, March 17 (CNA) A recently implemented small investment scheme is expected to give equity investors a new choice of asset management, according to the Taiwan Stock Exchange (TWSE).

The TWSE, which operates the local main board, said the scheme, similar to a regular savings plan for investors who put their money into mutual funds, will allow securities firms to tailor financial products for retail investors and help their clients manage their portfolios.

Under the scheme that was launched on Jan. 16, retail investors put fixed amounts at regular intervals into stocks and exchange traded funds to buy small volumes of high-priced stocks, the TWSE said.

The system, called the dollar-cost averaging method, is expected to offset market risk in the long run.

As of the end of January, asset management under the umbrella of the local securities sector was 7.3 percent higher than a year earlier at NT$133.1 billion (US$4.35 billion), according to the TWSE.

Of that amount, deals for fund management by brokerage firms totaled NT$93.6 billion, and for marketable securities NT$39.5 billion, TWSE data showed.

So far, 11 brokerage firms have been handling asset management, with the value of such deals growing from NT$64.5 billion in early 2016, the TWSE said, adding that most of the contracts were for investments in mutual funds at home and abroad.

Many brokerage firms in Taiwan specialize in asset management, the TWSE said, encouraging investors to join the small investment scheme in the securities sector to reduce risks and generate profits in the long term.

Currently, local brokerage firms are offering their own small investment schemes, either under their asset management or securities broking operations, the TWSE said.

For example, Yuanta Securities (元大證) and Fubon Securities (富邦證) offer small investment schemes under the equity broking business, while KGI Securities signs deals with clients under its asset management platform, the TWSE said.

Through a small investment scheme, retail investors will be able acquire expensive stocks, such as smartphone camera lens supplier Largan Precision Co. (大立光), as a long term investment by investing in them regularly, the TWSE said.

Many retail investors have complained that they cannot afford to buy Largan stocks, which are the most expensive on the local market.

Before the small investment plan became effective, stocks in Taiwan were usually sold in minimum blocks of 1,000 shares.

On Friday, Largan closed up 2.04 percent at NT$4,760.00 on the main board, which put 1,000 shares at a price of NT$4.76 million.

(By Tien Yu-pin and Frances Huang)

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