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Total Net Assets (TNA) of Funds in Asian Markets by Domicile

In the third quarter of 2025, the total net assets in the Asia Pacific region (excluding Australia) reached $8.95 billion, marking a robust increase of 16.6% year-to-date and 5.4% compared to the previous quarter. The region shows strong momentum, with only two markets experiencing declines this quarter. China leads the region, accounting for 56% of the total assets, while emerging markets such as Vietnam and Indonesia exhibit the fastest growth rates. Although Vietnam is the smallest market at $3.4 million, it is experiencing rapid growth, with a 12% increase this quarter, indicating strong investor confidence, supportive trade policies, or targeted sector investments. Indonesia’s double-digit quarterly growth reflects solid economic fundamentals and high investor interest in Southeast Asia’s largest economy. Japan’s steady 7% growth in total net assets aligns with improvements in corporate governance, the end of deflation, and rising foreign investor participation. As the region’s second-largest market, Japan’s consistent growth significantly contributes to the overall regional figures.

The Asia Pacific total net assets (TNA) landscape is showing strong health with a 16.6% year-to-date growth, largely driven by Hong Kong’s impressive recovery and Korea’s technology-led expansion. Despite economic difficulties, China remains a crucial market for Asia Pacific investments. China recorded solid growth of 14.7%, reaching $5,009 million year-to-date (as of Q3 2025), representing 56% of the region’s total net assets. Japan also showed consistent and significant growth of 20.9% from a large base. As the second-largest market at $1.65 billion, Japan’s steady TNA growth offers a reliable foundation for regional expansion, helping to reduce volatility caused by smaller, less stable markets. Hong Kong’s exceptional 35.7% year-to-date TNA growth stands out, likely reflecting a recovery from previous political and economic uncertainties, increased mainland China allocations routed through Hong Kong, successful launches of financial products or ETFs, a rebound in the property and financial sectors, and its strategic role as a gateway for international investors returning to China. Korea’s impressive TNA growth is driven by strong performance in the technology sector, especially semiconductors and electric vehicles. Despite some quarterly fluctuations, Singapore’s robust 27.7% year-to-date TNA growth confirms its position as a stable wealth management center attracting regional assets, particularly from Southeast Asia and China.

Figure1:The Net Asset Value($Million) by Domicile Country

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Total Net Asset Value (TNA) of Funds in Asian Markets by Asset

From the perspective of different asset types, equity is the largest asset class by size in the third quarter of 2025 (25Q3) and is the biggest absolute contributor to growth both quarter-over-quarter (QoQ) and year-to-date (YTD). Equity grew by $316,036 million (10.8%) from 25Q2 to 25Q3 and increased by $681,472 million (26.6%) for the year-to-date period ending 25Q3. Equity now represents the single largest category, making up 36.2% of the total assets under management (TNA). Significant inflows and valuation gains in equities are therefore driving a large portion of the overall market-level TNA growth.

Commodities experienced the highest percentage growth year-to-date at 123.3%, along with strong QoQ growth of 22.1%, reflecting substantial percentage gains from a smaller base. Money Market and Bonds remain the second and third largest asset pools, respectively, with modest positive growth year-to-date. The Money Market, known for its size, stability, and role as a liquidity refuge, reached $2,680,743 million in TNA (29.95% share), growing 2.06% QoQ (+$54,055 million) and 11.29% YTD (+$271,957 million). Bonds held $1,912,051 million in TNA (21.36% share), with a slight QoQ decline of 0.51% (-$9,817 million) but a 7.73% increase YTD (+$137,228 million).

Real Estate, however, showed a significant decline, dropping 17.3% QoQ (-$6,633 million) and experiencing the largest percentage decrease year-to-date at 23.0% (-$9,461 million). This suggests either substantial redemptions from real estate strategies, valuation markdowns, or a combination of both.

Figure2:The Net Asset Value($Million) by Asset

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Estimated Net Flows of Funds in Asian Markets by Domicile

In the third quarter of 2025, the Asian market saw a significant shift in investor sentiment. Following a substantial net inflow of nearly $190 billion in the second quarter, the region experienced a net outflow of $31.3 billion in the third quarter. China returned to substantial outflows, with a total net outflow of $25.3 billion in Q3, driving much of this volatility by moving from a large inflow of $176.2 billion in Q2 to a notable outflow in Q3. Meanwhile, Japan emerged as the most resilient and appealing market, recording the highest net inflows for the quarter and sustaining positive momentum.

China leads regional capital flows but remains highly volatile. It recorded the largest quarterly net outflow among Asian countries at -$25.3 billion. The surge in Q2 2025 was a technical rebound driven by strong government intervention and hopes for stimulus. However, the net outflows in Q3 2025 indicate these were short-term tactical moves by global investors rather than a renewed long-term confidence. Ongoing structural challenges continue to outweigh policy support. China accounts for the majority of the region’s total net inflows with $114.259 billion in year-to-date, mainly due to the exceptional Q2 2025 inflow that offset significant outflows in Q1 and Q3 2025.

Japan recorded the largest quarterly net inflow at +$10.5 billion and stands out as the only market with positive inflows in all four quarters. It has attracted steady foreign investment seeking quality, yield, and a hedge against regional uncertainties. Japan also posted the second-largest year-to-date net inflow in the region at $28.124 billion, supported by consistent quarterly inflows and a strong Q3 2025, making it the most stable positive contributor throughout the year.

India shifted from a promising net inflow in Q2 to a net outflow in Q3, reflecting a global risk-off mood affecting highly valued markets and possibly caution ahead of elections. South Korea experienced net outflows in three of the last four quarters, impacted by its high sensitivity to the global tech cycle and perceived geopolitical risks. Indonesia and Thailand showed relative resilience with year-to-date net inflows. Their domestically focused economies and steady, moderate growth appeal during volatile periods. Vietnam’s flows were negligible, indicating that its “China+1” manufacturing strategy has stalled for equity investors who are waiting for clear regulatory improvements.

The total ENF for the year-to-date period (up to the end of Q3 2025) is $129,421 million, indicating that the Asia region has attracted significant net new money despite highly volatile quarterly fluctuations. This positive total is driven by large inflows into a few key markets, which are balanced out by ongoing outflows in other markets, rather than widespread buying across all countries. India experienced the largest year-to-date net outflow at $16,029 million, showing continued selling pressure despite a temporary net inflow in Q2 2025. Korea had the second-largest year-to-date net outflow at $10,145 million, with outflows in Q4 2024, Q2 2025, and Q3 2025 outweighing a small inflow in Q1 2025, indicating ongoing risk reduction from Korean exposure.

Figure3:The Accumulative Net Flows by Domicile ($Million)

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Estimated Net Flows of Funds in Asian Markets by Assets

In the third quarter of 2025, Money Market experienced the highest net inflows among all asset classes, totaling $19,635 million, and leads the year-to-date (YTD) net inflows with $96,006 million. It is followed by Equity with $48,695 million and Commodities with $14,378 million in net inflows. Bonds saw the largest net outflows in 25Q3, amounting to $43,940 million, but still contributed a solid $13,902 million in net inflows for the year up to 25Q3. Money Market remains the top choice for new cash, indicating ongoing demand for liquidity and short-term instruments, despite a significant decline in flows in 25Q3 compared to 25Q2. Equity ranks second in YTD net inflows with $48,695 million, benefiting as the primary risk asset through strong buying from late 2024 to early 2025 and a robust recovery in 25Q3 following a weak 25Q2. Conversely, Mixed Assets experienced a substantial cumulative net outflow of $45,951 million, and Real Estate recorded $2,614 million in net outflows for the year, making these the only categories with negative net flows over the full period.

Figure4:The Accumulative Net Flows by Asset ($Million)

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Top/Bottom Net Flow by LGC

The largest net inflows were primarily focused on the Money Market CNY ($45,789 million), while equity sectors such as financials, materials, and industrials also received significant investments, indicating a preference for liquidity alongside targeted equity sector investments. Conversely, the most substantial outflows occurred in China-focused equity and bond funds, reflecting investor caution or capital withdrawal from Chinese markets. Additionally, Korean money market funds experienced notable decreases.

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