Foreign firms top Austrian fund of funds market
AUSTRIA – Foreign providers of funds of funds have increased their share of the Austrian market, with US houses now dominant.
According to independent information provider e-fundresearch, foreign fund providers now have a market share of 3.1 billion euros of the 8.1 billion-euro Austrian fund of funds business.
Of this market share, Merrill Lynch is the largest provider, with a market share of 9.8%. Fidelity Investments and J P Morgan Fleming follow in second and third place. Invesco and Alliance Capital Management are also among the leading providers of funds, although Invesco has seen its market share drop this year by 2.3%. Julius Baer saw its market share also fall.
Pioneer Investments and Vontobel Asset Management were the top two European fund providers in terms of an increase in market share.
The foreign fund managers provide funds to domestic fund of funds offered by institutions such as Raiffeisen Capital Management and Bank Austria.
The foreign provision of funds to such institutions was borne out of the Austrian tax system which discriminated against foreign fund providers. Domestic institutions allowing access to these foreign funds via fund of funds vehicles managed to get round the tax laws.
According to Albert Reiter, managing director of e-fundresearch, the fund of funds data one of the least difficult markets from which to obtain information in Austria, due to transparency of holdings. The information provider has been running the study for four years.
In total 57 foreign fund management companies were represented in the Austrian retail fund of funds market as of end June 2003.