Fund managers are moving their emerging markets desks to where the index already lives

Most Australian portfolios carry emerging markets as a single line item, run by an investment team working out of London, Boston or Paris. Amundi has spent this year moving in the other direction.

The European manager has relocated senior emerging markets investors into Hong Kong and Singapore, and the reshuffle tracks where the asset class has ended up.

Amundi confirmed that John O’Toole becomes chief investment officer for Asia, based in Hong Kong. He keeps the global head and chief investment officer role on the firm’s solutions platform that he has held since 2022. Four other senior investors have taken on Asia roles over the course of the year.

Andriy Boychuck, global deputy head of emerging markets fixed income, has worked from Singapore since May. Ray Jian took on the role of head of fixed income North Asia alongside his existing responsibility for emerging markets debt aggregate strategies, based in Hong Kong, in July.

Nick McConway, head of emerging markets equities, Asia, moves to Singapore this month. Siddharth Sanghvi, appointed emerging markets equity senior portfolio manager, joins him there. Three of the four previously worked from London.

The firm manages close to €2.6 trillion as at 30 June 2026, according to its own figures, and runs six international investment hubs across Paris, London, Dublin, Milan, Tokyo and San Antonio, the last through its partnership with Victory Capital.

The semiconductor allocation

The moves follow the money, and the money has been drifting east for a decade. Taiwan overtook China as the largest country weight in the MSCI Emerging Markets Index in April, holding 24.8 per cent of the index at 30 April on MSCI’s own figures.

By late May, Korea had reached close to one-fifth and India around 12 per cent, taking roughly 79 per cent of every dollar in the index to four Asian markets. A decade ago that figure was closer to 63 per cent. Korea has been the fastest mover of the four, roughly doubling its weight over eight months and closing to within a point of China by May.

Company concentration has followed the same path. Taiwan Semiconductor Manufacturing Company alone accounts for more than 14 per cent of the index, and together with Samsung and SK Hynix makes up almost a quarter of it.

An adviser recommending a passive emerging markets allocation is, in practice, recommending a concentrated position in Asian semiconductor manufacturing, with Latin America and emerging Europe reduced to a rounding error.

Fixed income has moved on a similar trajectory. Local currency sovereign and corporate debt across Asia now makes up a substantial share of emerging markets debt benchmarks, and the credit work behind it depends on issuer access, local legal systems and currency markets that trade while London sleeps.

Inside the time zone

The argument for putting decision-makers in the region is practical rather than glamorous. Portfolio managers meet company management more often and at shorter notice.

Credit analysts can read a restructuring in the jurisdiction where it will be litigated. Trading happens inside the time zone rather than at the tail of a European day, which tells in the markets where liquidity thins out quickly.

The timing question also runs closer to home for Australian practices. A Hong Kong or Singapore desk works within two or three hours of Sydney, so client queries during a market event get answered the same day rather than the next one.

The limits of location

Local presence helps most where the work depends on access, and less where the outcome depends on a call the whole market makes at once. Managers based in Hong Kong through 2021 and 2022 still wore the Chinese regulatory clampdown and the drawdown that followed, a fair reminder that a regional desk improves the quality of the information without removing the risk.

Familiarity brings its own demands, and a team close to one market hears the same local narrative every day. Testing a position against an outside view becomes part of the discipline rather than an afterthought. The firms building well in the region tend to pair the local desk with global oversight for exactly that reason, and Amundi has kept O’Toole’s global solutions responsibilities alongside the new Asia role.

The build-out across the region also runs wider than any single firm. Tax treatment, licensing regimes and competition for investment talent have moved teams between Hong Kong and Singapore for years, and AIMA reported in July that some managers were weighing moves in the other direction.

Advisers reviewing a manager learn more from what a regional presence changes inside the investment process than from the announcement of it, and that takes a full cycle to become clear.

Who holds the decision

An adviser reviewing an emerging markets manager gets further asking about the decision-making than about the address. Who holds the final call on a position, and did that person move? Does the research responsibility travel with the portfolio manager, or stay with an analyst team elsewhere?

Where a fund on an approved product list has a named manager relocating, the continuity of that fund’s process deserves a direct answer from the manager rather than an assumption. Emerging markets allocations have quietly become Asian technology allocations for most Australian clients, whichever manager runs them.

The firms building teams in Hong Kong and Singapore are betting that the next decade of returns will reward people who can see those markets up close. The next drawdown, rather than any announcement, will show advisers whether the relocation earned its keep.