Most Chinese investors don’t trust wealth management agencies

Most Chinese investors don’t trust wealth management agencies

Staff Reporter


People in China have their own system of wealth management, choosing to keep their own counsel rather than put their trust in professional organizations, valuing gains but ignoring risks, preferring to follow group sentiment and rushing to invest, and being fond of putting their eggs in one basket. These are the major findings of the newly issued Chinese Wealth Management 2013 white paper published by Golden Securities, a wealth management publication.

A survey in the white paper showed that 86.8% of the people surveyed preferred to manage their money by themselves, and only 13.2% of them would commission professional organizations to manage their assets for them. “Many wealth management professionals in financial institutions rarely put clients in an important position, and they rarely care if the products are appropriate for investments or how big the risks are,” said one woman. Even if clients are losing money, they don’t even mention it, she added.Even though many financial institutions’ managers have been conducting risk tests for their clients, they are mostly a formality, and may actually lead to disputes in the future, the report said.

On the other hand, the credibility risk of financial institutions could mean they have a better future if they can improve their services and create a win-win situation.

In the white paper, 44.6% of the people surveyed hope their assets may increase more than 20% annually, 39.5% expect growth of more than 10%, while 16.9% anticipate a growth of higher than the banks’ interest rates. In the survey, 11% said they can endure more than 20% or 30% of losses in the money they invested, 13% can take 10% to 20% of losses, while 76% said they can’t bear risks.

About 38.7% of the people surveyed focused on the property market, 25.3% on trust products, 23.2% on wealth management products offered by banks, 5.2% on stocks, 4.4% on gold, and 3.2% on other products.

China is seeing a growing income gap, and in 2011 the 500th richest person in China had assets of 2.17 billion yuan (US$352 million).

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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