Social media and business TV channels are popular in Taiwan, but print publications have a good reach as well
- Taiwanese financial intermediaries favour direct messaging applications (e.g LINE and WeChat) over traditional professional social media such as LinkedIn
- Brand strength is by far the most important fund selection factor, overshadowing all other criteria
- More than 55% of financial intermediaries have been prompted by online editorial pieces to conduct research on a new fund
The use of social media and TV channels is high among financial intermediaries in Taiwan, but print newspapers are still popular as well, according to a survey by Fundamental Research.
Taiwanese investment professionals favour direct messaging applications such as LINE and WeChat over traditional professional social media like LinkedIn. They mainly use social media in a professional manner to read content from asset managers, but three out of four also use social media to contact clients.
In 2019, Fundamental Research surveyed wholesale and retail intermediaries in Hong Kong, Taiwan and Singapore about their views on fund selection, asset manager communication and their media consumption habits. Fundamental Research has conducted similar research in Europe and the Unites States of America.
The most important fund selection criteria
Brand strength is by far the most important fund selection factor for Taiwanese financial intermediaries, overshadowing all other criteria. A good second is volatility/risk. As the Taiwanese regulations are fostering the master trust distribution model for offshore funds, foreign asset managers don’t have to incur huge costs to set up their office on the island and can thus often afford expensive marketing campaigns to attract new assets – hence the importance of brand strength.
On the other hand, cost and transparency are ranking surprisingly low, which is in sharp contrast with most other countries surveyed, where those factors are usually in the top five of fund selection criteria. However, for end investors cost is almost three times as important as a selection criterion than it is for financial intermediaries, while brand strength is almost twice as important for financial intermediaries.
More than 55% of financial intermediaries have been prompted by online editorial pieces to conduct research on a new fund. Furthermore, 30% of respondents researched a new fund after having seen the fund advertised online. Peers/colleagues are ranking at the very bottom in Taiwan while it is ranking at the very top in Singapore, suggesting different approaches towards fund research in both Asian countries.
Other findings from the Taiwanese Financial Intermediary Research include:
- When it comes to communication with asset managers, about one third of respondents are happy with the current communication they receive. However, communication support regarding investment-related topics such as market analysis/outlook and updates from fund managers regarding existing investments would be greatly appreciated.
- Global bonds is the asset class with the highest growth potential in the Taiwanese market, likely due to the recent deregulation of Formosa bonds – i.e. bonds issued in Taiwan but denominated under a foreign currency – as well as the boom of fixed income ETFs.
- With 68% of respondents applying ESG criteria, responsible investing proves to be more popular in Taiwan than in other Asian countries surveyed such as Singapore. ESG is also an important fund selection criterion for almost one in four respondents.
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