The firm writes that Vietnam benefits from the trend in China, and globally, to outsource supply and production. The country has a young, well-educated population, creating a skilled work force and attractive wages. Its economy, supported by a raft of trade agreements and solid infrastructure, is very attractive to Foreign Direct Investment (FDI) and enjoys a stable political environment and economic policies. Vietnam’s ambition, as living standards improve and its industries move up the value chain, is to be classified as an emerging market within five years.

Shasha Li Mafli will manage the Fund and has more than 20 years of experience managing Asian investment portfolios, including a track record of consistent performance in Vietnamese equities.

“Vietnam is at a sweet spot in Asia, growing strongly with many of the pre-requisite factors in place for economic expansion as it urbanises and industrialises,” says Shasha Li Mafli. “We think that the country is positioned to enjoy the kind of growth that China has experienced over the past 15 years.”

“Shasha has experienced first-hand the transformation of China into a middle-income economy and she firmly expects Vietnam to follow the same growth trend,” says Andreas Söderholm, Head of Asset Management, Switzerland. “The new Fund matches our philosophy of working with outstanding managers to invest in specialist, active strategies to generate performance for our clients.”

The Strategic Vietnam Prosperity Fund is a UCITS fund, catering specifically to professional and institutional investors seeking exposure to Vietnam.

Over the past decade, Asian pension funds have gradually diversified their portfolios overseas and into riskier assets such as equities and alternatives. This trend continues apace, Cerulli writes, as they mature and adopt more sophisticated investment strategies. In addition, the poor macroeconomic environment has put pressure on Asian pension funds, with major funds in markets such as Taiwan and Malaysia impacted by global market losses and contributions that have been unable to keep pace with benefit payouts. 

More importantly, many Asian pensions have urgent needs for yields to meet their liabilities and support rapidly aging populations. For instance, Korea’s National Pension Service (NPS) is projected to run dry in 2055, and local industry observers have called for a more aggressive investment strategy, including overseas diversification, to help extend the scheme’s longevity. 

Against this backdrop, most Asian pension schemes’ alternative investments have grown by double digits between 2018 and 2022. As a proportion of their portfolios, alternative allocations for major pension funds rose between 2020 and 2022. Growth was led by Korean pensions: the NPS’ alternative allocations grew 5.5 percentage points and the Korean Teachers’ Pension Fund’s rose 4.1 percentage points during the two-year period. In 2022, alternatives accounted for 10.1 per cent of total retirement assets in the Asia-ex-Japan region, the highest seen for that asset class in since 2018, Cerulli says. 

The challenges faced by pension funds in alternatives investing are areas where asset managers can step in to provide their expertise, the firm says. Nearly 41 per cent of Asian pensions surveyed by Cerulli cite a “limited understanding” of alternatives, while one-third say they lack in-house expertise when investing in alternatives.  

“While Asian pensions continue to boost their alternatives portfolios, it will likely take many more decades for them to build sufficient in-house expertise in the area. Hence, alternatives remain a greenfield for asset managers,” says Shaun Ng, analyst with Cerulli. “Managers seeking to win alternatives mandates from Asian pension funds should be able to source suitable deals, demonstrate a strong track record in specific alternative asset classes, and share knowledge with their clients.”