Tisco Asset Management expects 5% growth in assets under management (AUM) in 2019, similar to this year's performance, as market sentiment remains volatile amid prevailing global and domestic risks.
The Sino-US trade disputes and rising interest rates will have an impact on global and domestic stock markets next year, subsequently pressuring returns from stock investment, said Pavinee Ongvasith, chief executive of Tisco Asset Management.
For fixed-income securities, factors having an impact on the asset class's investment outlook include rising interest rates, a narrower return gap between long-term bond yields and fixed-deposit interest, and the Finance Ministry's planned imposition of a 15% withholding tax on fixed-income funds, likely to come into effect in mid-June, Ms Pavinee said.
Returns on investment in fixed-income securities and stocks are expected to decrease next year if the ongoing trade disputes persist and the rise in interest rates continues, she said.
"These negative factors will affect fund flows, cause volatility in emerging-market currencies and induce a global economic slowdown, therefore a cautious investment strategy is suggested, especially for long-term investment," Ms Pavinee said.
She said these negative factors have already affected the mutual fund industry this year.
Total AUM of Thailand's mutual fund industry saw an average increase of 10% over the past few years, but this year's rise in AUM is less than 1%.
Tisco Asset Management's total AUM is currently valued at about 250 billion baht, a 5% year-on-year increase.
The company's AUM growth is projected at about 5% in 2019, considered a low growth ratio compared with a 34% increase logged in 2017, Ms Pavinee said.
Separately, Tisco Asset Management will offer a long-term investment theme in 2019 to focus on retirement funds and provident funds.
The investment strategy will focus on mixed assets diversified into fixed-income securities at 50%, equities at 30% and REITs or property funds at 20%
Expected return on this mixed fund is roughly 3.5%.
"We will focus on a smart retirement [investment] theme for next year, mixing various assets in our portfolio and launching a trigger fund when market timing supports [the move]," Ms Pavinee said.
"2019 will be the year of high risk and low return, so we should invest and focus on assets with sustainable returns," she said. "High-growth stocks will be risky, as we have seen many [listed] companies miss their revenue targets in 2018."
