IDEAS home Printed from https://ideas.repec.org/p/wpa/wuwpfi/0409036.html
   My bibliography  Save this paper

The 1998 Third Annual Survey of Risk Management Practices of Unit Trusts in Singapore

Author

Listed:
  • CORNELIS A. LOS

    (Kent State University)

Abstract

Liberalization of Singapore's financial sector causes its fund management industry to expand rapidly. As of December 1, 1998 there were 191 unit trusts to choose from. Eventually, Singapore, like the USA and Hong Kong, will have more unit trusts than stocks listed on its exchange. Many challenges recently faced the industry: (1) in 1997-98 the Asian Financial Crisis created a very difficult investment climate; (2) in 1997 the Investment Management Association of Singapore was registered as a private industrial body; and (3) in 1998 the Government introduced a multi-pronged strategy to make Singapore a premier fund management center in Asia in the next five to ten years. We report the results of an ongoing survey of the transformation of the fund management industry in Singapore and focus on the improvement of its risk management practices. This project was initiated in 1996 and is continued under the aegis of the Unit Trust Research Unit of NBS' Centre for Research of Financial Services (CREFS). Overall we find a better industry awareness and more realism than in the preceding years. The quality of both the survey responses and of the reported risk management practices has improved in the past three years. The 1998 response rate was 25.9%, up from 11.4% in 1996. There is more disclosure of the managers' background, asset allocation, investment styles and various kinds of risk exposures. Regrettably, still two thirds of the unit trusts do not provide any risk analysis to their unit holders, because it is still not common practice. Singapore unit trusts diversified more to the developed markets in North America and Europe. But there is still an undue concentration on equity investments. Forwards only often hedge currency risk exposure. But two thirds of the respondents in 1998 thought that it was an excellent time to pick up common stocks at bargain prices in the region.

Suggested Citation

  • Cornelis A. Los, 2004. "The 1998 Third Annual Survey of Risk Management Practices of Unit Trusts in Singapore," Finance 0409036, EconWPA.
  • Handle: RePEc:wpa:wuwpfi:0409036
    Note: Type of Document - pdf. Los, Cornelis Albertus, 'The 1998 Third Annual Survey of Risk Management Practices of Unit Trusts in Singapore' (May 1999).
    as

    Download full text from publisher

    File URL: http://econwpa.repec.org/eps/fin/papers/0409/0409036.pdf
    Download Restriction: no

    More about this item

    Keywords

    Risk Management; Unit Trusts;

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • C42 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Survey Methods

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpfi:0409036. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA). General contact details of provider: http://econwpa.repec.org .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.