Financial Performance - Total revenue for the nine months ended September 30, 2022, was HKD 35,493,000, a decrease of 17% compared to HKD 42,780,000 in the same period of 2021[18]. - Fund management business revenue was HKD 35,061,000, down 17% from HKD 42,399,000 year-on-year[18]. - The company reported a gross profit of HKD 32,669,000, which is a 14% decline from HKD 37,938,000 in the previous year[18]. - Operating loss increased to HKD 20,936,000, representing a 51% increase from HKD 13,894,000 in the same period last year[18]. - The total comprehensive loss attributable to owners of the company was HKD 21,341,000, up 17% from HKD 18,297,000 in the previous year[18]. - Basic and diluted loss per share was HKD 5.67, a 25% increase compared to HKD 4.52 in the same period of 2021[18]. - The group reported a pre-tax loss of HKD 22.3 million for the reporting period, compared to a loss of HKD 15.8 million in the same period of 2021[41]. - The loss attributable to the company's owners was HKD 22.7 million (after tax), compared to HKD 18.1 million in the same period of 2021[41]. - The group's revenue for the reporting period was HKD 35.5 million, a decrease of HKD 7.3 million or approximately 17% compared to HKD 42.8 million in the same period last year[189]. - Gross profit for the group was HKD 32.7 million, down HKD 5.3 million or 14% from HKD 37.9 million in the previous year, primarily due to a decrease in average revenue per unit of assets under management[189]. - General and administrative expenses increased to HKD 53.6 million, up HKD 1.8 million or approximately 3% from HKD 51.8 million in the same period last year, mainly due to higher employee costs and IT expenses[189]. Market Conditions - The stock market experienced unusual conditions, with most indices showing negative returns of 2.6%[21]. - The market environment was characterized by limited volatility response despite overall stock declines, leading to fewer alpha opportunities[25]. - The reporting period showed unusual conditions with limited market reactions despite significant stock market losses[25]. - The overall market environment during the reporting period presented fewer alpha opportunities due to limited reactions in the options market despite stock declines[158]. - The market began pricing in expectations for monetary easing in 2023 after the June 2022 FOMC meeting, indicating a potential shift in interest rate trends[177]. - The dynamics of inflation, monetary policy, and bonds are likely to have significant implications for the future stock market[178]. Investment Performance - True Partner Fund achieved an average quarterly return of 6.1% during the eleven negative quarters of the MSCI World Index, which had an average quarterly loss of 8.6%[22]. - The True Partner Fund's performance was notably different from the Put Protection Index and VIX Tail Hedge Index, focusing on absolute returns and alpha[28]. - The True Partner Fund outperformed the CBOE Eurekahedge relative value volatility hedge fund index and other benchmarks in both absolute and alpha terms since its inception in July 2011[33]. - The highest return for the True Partner Fund during these negative quarters was 23.3%, while the lowest was a decrease of 2.6%[158]. - The average return of the Put Protection Index and VIX Tail Hedge Index was slightly worse than the unprotected S&P 500 Total Return Index[26]. Asset Management - As of September 30, 2022, the asset management scale was $1,708 million, an increase from $1,665 million on September 30, 2021, and $1,675 million on December 31, 2021, driven by positive net inflows despite negative investment performance[36]. - The group's assets under management (AUM) reached USD 1,800 million in 2022, up from USD 1,500 million in 2021[132]. - As of September 30, 2022, the company's assets under management totaled $1,708 million, comprising $447 million from mixed fund products and $1,261 million from managed accounts[143][144]. - The group's fund tools AUM was USD 447 million, while managed accounts AUM was USD 1,261 million as of September 30, 2022[163]. - The average revenue per unit of asset management scale decreased during the reporting period compared to the nine months ending September 30, 2021, due to a shift in focus from management fees to performance fees[37]. Strategic Developments - The group actively engaged with investors and potential clients through webinars and industry conferences held in Europe and the US during Q2 and Q3 of 2022[41]. - The group obtained an investment company license from the Dutch Authority for the Financial Markets on March 24, 2022, and a Qualified Foreign Institutional Investor (QFII) license from the China Securities Regulatory Commission on August 24, 2022[41]. - The acquisition of 49% of TruePartner Advisor Hong Kong Limited was completed on February 15, 2022, granting the group full ownership to expand its investment mandates[42]. - The group plans to continue expanding its technology and marketing teams as part of its growth strategy[41]. - The group is focused on leveraging its expertise in the Chinese domestic capital market through the newly acquired QFII license[41]. - The group aims to enhance shareholder returns by utilizing the licensed asset management company for additional investment mandates[42]. - The board believes that the acquisition of TPAHK will optimize the asset management of the group and enhance shareholder returns[193]. Economic Factors - The yield on the 10-year U.S. Treasury bond rose from 1.51% at the end of 2021 to 3.83% by September 30, 2022, reflecting a significant increase in interest rates[149]. - The U.S. dollar index increased by 17.2%, rising from 95.67 to 112.12 during the reporting period, influenced by differing monetary policies between the U.S. Federal Reserve and the Bank of Japan[150]. - Inflation was initially thought to be transitory, but it has been widely accepted as a more persistent phenomenon, impacting monetary policy expectations[176]. - The potential for "stagflation" could negatively affect both stocks and bonds, creating conditions for market volatility and opportunities for certain volatility strategies[182]. - The geopolitical risks from the ongoing Russia-Ukraine conflict are expected to have lasting impacts on commodity markets, particularly energy costs in Europe[181]. Challenges and Risks - The company's trading strategy faced challenges during the reporting period, particularly in the first quarter of 2022, due to a lack of opportunities as stock indices declined and volatility remained subdued[32]. - Rising bond yields have decreased the relative attractiveness of stocks, particularly those reliant on long-term growth projections, impacting stock market valuations[182]. - The company's investment clients primarily consist of professional investors, including family offices, pension funds, and high-net-worth individuals[144]. - The group experienced positive net inflows driven by large clients, despite negative performance in some fund products[160].
TRUE PARTNER(08657) - 2022 Q3 - 季度财报