SMU-22-0029
ANT FORTUNE: PROVIDING UNIVERSAL WEALTH
MANAGEMENT SERVICES IN CHINA
China had the largest consumer market globally and developed the second largest tech industry
in the world. A shift to a market liberalisation policy led to decades of high economic growth
driven by rapid industrialisation and increased manufacturing productivity. Many residents were
lifted out of poverty on the back of the resultant economic growth. Digitalisation and the
emergence of the local tech industry provided another boost to productivity. A high mobile
penetration rate enabled Chinese consumers to conduct various commercial activities online. As
their disposable income level began to rise, they started putting money in savings accounts and
real estate. However, many locals had never purchased an investment product before.
Ant Fortune, together with financial institution partners, aimed to bring more inclusive wealth
management services to consumers. The popularity of Alipay meant that most consumers already
had the Ant Fortune platform installed on their smartphones. For as little as RMB1 (US$0.151),
users could purchase the Yu’e Bao (translated as leftover treasure) money market fund or wealth
management products from its fund platform within the Ant Fortune app. Ant Fortune made use
of technology to increase the affordability for consumers and provided educational materials for
new investors.
During the meeting, Wang discussed with executives from several fund providers how the Ant
Fortune platform could help them improve their operations and better serve users. She aimed to
make the platform safer and more attractive by helping consumers better understand investmentrelated risks and helping fund providers become more efficient. Her main business objective was
to make Ant Fortune the most trusted wealth-management platform that promoted investment
education to benefit society and the most trustworthy partner for wealth management firms.
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
In May 2022, Wang Jun, chairperson of Ant Fortune, a comprehensive wealth management
platform under Ant Group attended a meeting in her office at the Ant Group headquarters in
Hangzhou, China. The modern compound housed employees from different departments,
allowing them to interact and collaborate. Cashless payments allowed employees to conveniently
purchase goods and services at supermarkets, restaurants, and retail stores within the premise
while hi-tech safety features allowed them to go about their business quickly and securely. The
interior of the office buildings also contained ant sculptures to remind employees of their mission
to look out for the little guys.
China Economy
Located in East Asia, the People’s Republic of China had the world’s largest population and
1
US$1 = RMB6.61 as at May 1, 2022.
This case was written by Associate Professor Liang Hao and CW Chan at the Singapore Management University. The
case was prepared solely to provide material for class discussion. The authors do not intend to illustrate either effective
or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying
information to protect confidentiality.
Copyright © 2022, Singapore Management University
case centre
Distributed by The Case Centre
All rights reserved
Version: 2022-07-24
e info@thecasecentre.org
t +44 (0)1234 750903 or +1 781 236 4510
w www.thecasecentre.org
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
shared its borders with 14 other countries, including India, Russia, and North Korea. Throughout
its 5,000-year history, China had been largely an agricultural society with a unique culture.2
Socially, economic growth allowed the government to prioritise the eradication of poverty.6 It
increased productivity by using development loans to stimulate economic development instead
of making welfare handouts. 7 Foreign investment was utilised to aid the country’s
industrialisation. China flourished through international trade; its share of goods traded increased
from 1.9% in 2000 to 11.4% in 2017.8 Consequently, more than 800 million Chinese citizens
were lifted out of poverty.9
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
The 2010s saw the rise in China’s tech sector, which listed the second-highest number of unicorns
(privately held companies with a billion dollar valuation) after the United States.10 The usage of
mobile internet became increasingly ubiquitous. People used smartphones to watch videos, chat
online and shop for consumer products. Tech giants such as Alibaba, Baidu, Tencent and Huawei
became household names with large customer bases.
By 2021, China’s population grew to 1.41 billion.11 Simultaneously, its GDP per capita grew
from less than US$200 in 1978 to US$12,500 in 2021.12 On aggregate, China became the world’s
second-largest economy. 13 As of 2021, with an internet penetration rate of 73%, Chinese
shoppers were the most digitised consumers globally, completing 20% of total retail sales
online.14,15
Emergence of Financial Markets
The need for financing and investment opportunities grew along with the economy. After the
absence of a stock market for decades, the Shanghai Stock Exchange and the Shenzhen Stock
Exchange were launched in 1990 and 1991 respectively for domestic companies to raise capital
Britannica, “China”, October 4, 2022, https://www.britannica.com/place/China, accessed October 2022.
Christina Zhou and Bang Xiao, “China's 40 years of economic reform that opened the country up and turned it into a
superpower”, ABC News, December 1, 2018, https://www.abc.net.au/news/2018-12-01/40-years-of-reform-that-transformedchina-into-a-superpower/10573468, accessed June 2022.
4
“China in Brief, Opening to the Outside World”, China.org.cn, July 13, 2000, http://www.china.org.cn/echina/openingup/sez.htm, accessed July 2022.
5
Through 2021.
The World Factbook, “China Economy”, https://www.cia.gov/the-world-factbook/countries/china/#economy, accessed July 2022.
6
Luk Tak-chuen, “The Politics of Poverty Eradication in Rural China”, China Review, 2000,
https://www.jstor.org/stable/23453381, accessed July 2022.
7
Ibid.
8
Stephanie Segal and Dylan Gerstel, “Evolution of U.S. Economic Engagement with China”, Center for Strategic and
International Studies, February 1, 2021, https://www.jstor.org/stable/resrep28663.5, accessed July 2022.
9
People living on less than $1.90 a day were considered in poverty.
The World Bank, “China Overview”, https://www.worldbank.org/en/country/china/overview, accessed July 2022.
10
Edward Tse, “China’s Systemic Advantages for Tech-Enabled Innovations”, Center for Strategic and International Studies,
February 1, 2020, http://www.jstor.com/stable/resrep22605.8, accessed July 2022.
11
Population 2022 estimate, GDP 2020 estimate.
The World Factbook, “China Society”, https://www.cia.gov/the-world-factbook/countries/china/#people-and-society, accessed July
2022.
12
The World Bank, “GDP per capita (current US$) – China”,
https://data.worldbank.org/indicator/NY.GDP.PCAP.CD?locations=CN, accessed July 2022.
13
WorldData.info, “The world's largest economies”, https://www.worlddata.info/largesteconomies.php#:~:text=With%20a%20GDP%20of%2023.0,9th%20place%20in%20this%20ranking, accessed September 2022.
14
Global Times, “China has 1.032 billion internet users, 73.0% penetration rate”, February 25, 2022,
https://www.globaltimes.cn/page/202202/1253226.shtml, accessed July 2022.
15
“The Alipay phenomenon and how it works” (video), Financial Times, June 5, 2018,
https://www.youtube.com/watch?v=NvEYhCW_v3g, accessed July 2022.
2
3
2/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
In 1978, China initiated reforms to liberalise its economy, implementing policies that included
the adoption of more market-based principles.3 The coastal areas of Shantou, Shenzhen, Zhuhai,
Xiamen and Hainan Island were designated special economic zones where laws and regulations
were more conducive to trade.4 The regions thrived under market principles and helped China
achieve one of the world’s highest economic growth rates of 9% annually.5
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
Besides making bank deposits or buying conservative wealth management products17 offered by
banks, people preferred to allocate wealth to the property sector as their level of disposable
income rose (refer to Exhibits 1 and 2 for the asset allocation preferences of Chinese households).
The lack of investment opportunities had increased speculation in the property market, which
had experienced a boom in the past 20 years and was regarded as the safest option for most people
to accrue wealth quickly. This further fuelled property inflation.
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
Locally, stock markets in China were dominated by unsophisticated retail investors who had
limited knowledge of financial market fundamentals. The existence of market frictions (daily
price limits for stocks, lack of efficient delisting rules) made the stock markets in China relatively
inefficient. In 2020, more than 500 million people still had never previously bought a financial
product.18
Mutual funds were popular globally as they were convenient to buy, and consumers could gain
the benefits of diversification and professional portfolio management. However, the domestic
mutual fund market was relatively small; less than 10% of investable assets were invested in
mutual funds. 19 In 2019, 57% of mutual funds were purchased directly from mutual fund
companies, 24% from banks, 11% from internet companies and 8% from brokerages (refer to
Exhibits 3 and 4 for the distribution channels of wealth management products).20 However, the
trend was that online sales were growing.
Ant Group
Ant Group traced its roots back to Alipay, which was launched in 2004 as an electronic thirdparty payment system to facilitate online sales. It served as an escrow service by holding money
from consumers and only releasing that money to merchants when the goods had been received.
Alipay helped to erase the trust deficit between buyers and sellers. As the digital era evolved,
Alipay transformed from a payment tool to an open platform for businesses, institutions, service
providers, and other partners. Business partners in various industries would utilise Alipay to offer
consumers a safe and convenient payment experience as well as enhance their digital operations.
Alipay was so successful it managed to acquire one billion active users and 80 million merchants
by 2021.
In 2020, the company renamed itself Ant Group. With technological innovation, Ant Group
supported its partners by providing inclusive, convenient digital life and digital financial services
to consumers and SMEs. In addition, it constantly introduced new technologies and products to
support digital transformation and industrial collaboration. Working together with global partners,
Ant would enable merchants and consumers to make and receive payments globally (refer to
Exhibit 5 for selected Ant Group businesses).
Henry M. K. Mok, “The Evolution of China's Stock Markets”, The Chinese University of Hong Kong Press, 1995,
https://www.jstor.org/stable/23453189, accessed November 2022.
17
These products typically comprised 60% in fixed income assets and 30% in cash with little in equities.
18
Ant Group, “Believing is seeing - Ant Group Corp Video”, 2020, https://www.antgroup.com/en/ir/notices, accessed July 2022.
19
Master Ye Speaks, “Who is the ‘Big Brother’ of the Asset Management Arena Between Bank Wealth Management Companies
and Public Funds?” (in Chinese), June 5, 2022, https://mp.weixin.qq.com/s/QcLdFQaHPGaWup2KD-sc0w, accessed July 2022.
20
Asset Management Association of China, “Proportion of Sales Volume of Public Offering Funds in Each Channel (in Chinese),
https://www.amac.org.cn/researchstatistics/datastatistics/fundsalesindustrydata/, accessed November 2022.
16
3/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
and for locals to invest.16 However, equities were considered risky assets. Traditionally, only
high-net-worth individuals (HNWI) invested in diversified portfolios that included stocks, bonds,
currencies, commodities, real estate, and cash. Wealth management service providers had to
assign relationship managers to assess the suitability of investment strategies for their clients.
Most other individuals had low levels of investment maturity and financial literacy.
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
Ant Fortune
In 2015, Ant Fortune began to host non-money market fund products on its platform. Ant Fortune
was committed to partnering with asset management firms to offer more inclusive wealth
management services. Subsequently, the number of asset management companies that offered
products on the platform grew to more than 150. These companies could open a corporate account
on the platform, Caifuhao, that would give them access to Ant Fortune’s Artificial Intelligence
(AI) capabilities that included better user connectivity, operational optimisation, and smart
marketing.
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
Ant Fortune was especially popular with the youth, with many of its early adopters below 36
years of age.22 Financial consumers could use the Ant Fortune portal to invest in a variety of
funds. Users could complete transactions using their smartphone app. Dou Yuming, President of
Zhong Ou Fund Management, a partner fund house on Ant Fortune known for delivering solid
long-term investment returns, shared how the internet was disproportionately beneficial to the
finance industry,
The internet has been useful in helping many industries develop. However, it is more useful
for services industries than manufacturing industries. The sales and customer service
functions have been greatly improved. In the financial industry, the online sales of banks
have far exceeded that of offline. One big reason is that we don't need to deal with logistics.
Wang elaborated on how the finance industry had been poised to capitalise on technological
improvements,
The flow of information is the core of finance and technology has made the process faster,
especially in China. The level of digitisation and standardisation is relatively high. For
example, the Application Programming Interface between all the distributors and mutual
fund houses in the public fund market and the payment system between banks through Union
Pay (a bank card service provider) have been standardised long ago.
Ant Fortune built a platform that would link users with fund providers. It charged financial
institutions service fees but viewed them more as partners. The more financial institutions offered
their products on the Ant Fortune platform, the greater the choices available to consumers. The
platform naturally would become more valuable as the number of consumers and financial
institutions grew.
Inclusive Wealth Management Services
Lowering Investment Barriers
Ant Fortune began to take shape after the launch of Yu’e Bao. After making online purchases,
users could use their remaining balances in the Alipay app to earn some interest. The first
Yifan Xie and Chuin-Wei Yap, “Meet the Earth’s Largest Money-Market Fund”, The Wall Street Journal, September 13, 2017,
https://www.wsj.com/articles/how-an-alibaba-spinoff-created-the-worlds-largest-money-market-fund1505295000?mod=article_inline, accessed October 2022.
22
Lerong Lu, “How a Little Ant Challenges Giant Banks? The Rise of Ant Financial (Alipay)’s Fintech Empire and Relevant
Regulatory Concerns”, Thomson Reuters, accessed July 2022.
21
4/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
Ant Fortune was a comprehensive wealth management platform that catered to individual
consumers with little financial management expertise (refer to Exhibit 6 for a screenshot of the
Ant Group platform). In 2013, as the mutual fund market in China began to grow, Ant Fortune
launched Yu’e Bao in partnership with Tianhong Asset Management. It started as a moneymarket mutual fund, but by 2017, Yu’e Bao had grown to become the largest global moneymarket fund with 370 million account holders and US$211 billion under management.21
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
investment product most of them would purchase was Yu’e Bao, which would start a new round
of wealth management enlightenment among consumers. Wang detailed how consumers could
deposit their money in the highly liquid money market fund for small returns,
As consumers began to develop familiarity with money market funds, they also learnt more about
mutual funds and wealth management in general. Wang continued,
Users’ needs are not limited to money market funds. They also want to invest in active funds,
among other financial products. We care more about building a long-term relationship. We
have grown with a large segment of our users. A typical consumer is a young person who
just graduated and is not very rich. After working for a while, he or she will gradually
accumulate more wealth that will be invested through our platform.
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
While the traditional financial advisory industry dealt with HNWIs, Ant Fortune and its partners
utilised technology to reduce the marginal cost of serving consumers. The introduction of Yu’e
Bao had allowed Ant Fortune to build a large user base on the platform with a lower investment
threshold. The minimum investment amount in the mutual fund industry used to be around
RMB50,000 before the launch of Yu’e Bao. Dou identified the main factor for cost decreases,
Technology reduces the manpower requirements for companies. For example, the size of
China’s fund industry is 25 trillion Yuan. The industry employs 12,000 people. If the amount
rises to 100 trillion Yuan, does that mean we need 48,000 people to manage it? It is more
likely that with the advancement of technology, increasing the assets under management by
four times, the number of employees will only double at most.
Wang added that fund providers found it more cost-effective to sell on the platform than through
direct sales,
Ant Fortune uses technology to help users. Among the various sales channels through which
asset management institutions serve users, we are one of the most effective channels to reach
users, and one of the healthiest channels in terms of the return-on-investment metric. This
makes us different from other channels, allowing us and the funds to be interdependent, a
process that eventually produces better services for users.
Ant Fortune had invested heavily in tech-enabled investor services to help consumers. It used
robot advisors that had to understand customer questions and be able to communicate complex
financial information to them. Wang also discussed how the Ant Fortune team assisted consumers
in making informed investment decisions,
We employ a large research team to build up the financial intelligence of our ecosystem
capabilities. We get a lot of institutions and fund companies to input their views on the market,
and then we will record their views. Every time they do a forecast on the market outlook, we
go back and see if it's correct, and then we score and rank the accuracy of the agency's
forecast on the market. After integrating a lot of databases, it will be processed at the
financial application level to generate various indicators. Therefore, the robot’s financial
intelligence is empowered by the investment research team and investment advisory team.
While intelligent robots still found it difficult to understand natural semantics, great
improvements had been made in the area of wealth management. Robo-advisors were able to
accurately handle semantic recognition and understand the questions asked by users. Wang
explained how a robo-advisor was used to help users better understand the health of their
investment portfolios,
5/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
People can purchase the fund, starting from one Yuan, with whatever money was leftover in
the Alipay account. The money market in China was stable, so Yu’e Bao grew very quickly
and hundreds of millions of Chinese use Yu'e Bao today.
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
We have had 200 million users communicate with the robo-advisor, Super Ant, asking basic
customer service questions, how it evaluates various funds, and whether it thinks the market
will rise or fall. After that, Super Ant will help consumers perform a portfolio diagnosis.
All the financial products hosted on the platform were offered by third-party partners. Ant
Fortune aimed to be as inclusive as possible and acted as an open platform to attract fund
providers and consumers in order to increase the network effect of the platform. Ant Fortune
provided technological support to allow its partners to deliver digital financial services for
consumers and educate users using digital solutions such as livestreaming sessions; it allowed
any fund to be registered on the platform, as long as it satisfied certain basic requirements. Wang
spoke about the importance of being an open platform,
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
As a wealth management platform, Ant Fortune must be an open platform. We need to create
links as we do not supply any assets. We connect asset suppliers and many other service
providers included in this ecosystem, including financial information providers. We help
institutional partners to enhance their operation, including better engagement with their
users and higher operation efficiency, through digital tools like Caifuhao. Most of the 9,000
mutual funds in China are available on Ant Fortune.
Value-added services were provided to attract mutual fund providers. Besides the ability for
partners to publish their own content, Ant Fortune provided data analysis and tools for them to
manage their investor relations. It also helped them gain more insights and customise suitable
financial products. Dou espoused the benefits of the new business model,
Ant Fortune has been the largest and one of the most important partners of Zhong Ou. Over
the past several years, Zhong Ou was one of the fastest-growing companies in the industry.
The biggest boost in sales came from our cooperation with Ant Fortune. Previously in wealth
management, there were three components to good service delivery. First, fund companies
like ours had to provide a good product. Second, there had to be convenient channels where
consumers could buy the product. Third, investment advisers had to serve clients by proving
investment recommendations. Before the advent of the Internet, banks were both the sales
channel and the service providers. Investment advisers had to recommend products to
customers. In this offline model, the priority for the business was to drive up the assets under
management of clients. This expensive step can now be removed.
In the eyes of many financial professionals, the China market was not as mature as those in
developed countries. According to efficient market hypothesis (EMH), the share price of any
stock should reflect all available information. As a result, it would be difficult for anyone to
consistently beat the market, as stocks would trade at their fair market value on exchanges. In an
inefficient market, stocks might not trade at their fair market values and fund managers would be
able to achieve alpha (or excess returns) and beat the market through stock picking. Wang
elaborated on how investors should allocate their funds,
In China, many active equity funds show returns far beyond the performance of the market
index. There is still room for good fund managers to earn alpha or excess returns. The era
of beta, a measure of volatility relative to a benchmark, will come when the market becomes
more efficient. However, alpha funds depend on good investment research teams, and the
human resource cost is expensive, so the cost of the product is high.
Dou provided an overview of his firm’s product offering and strong performance,
Some companies base their services on active products, some on passive products, and some
offer full product lines. Zhong Ou is ranked 12th out of 140 fund companies in the fund
industry. However, we do not offer passive products such as exchange traded funds or
alternative instruments such as real estate and commodities. We are a company that focuses
6/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
Open Platform
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
entirely on active investment. Our fund products comprise four broad categories: equities,
fixed income, multi-asset and cash management.
Therefore, for any commercial arrangement we make with asset management institutions, we
must stand on the users’ side, favouring users and being user-centric. It’s in the DNA of an
internet company to be user-centric. For us, it is not empty talk, but an ethos that permeates
our business logic.
Ant Fortune’s goal was not to increase the trading frequency of individuals to earn fees. Instead,
it aimed to help users invest sustainably with a long-term investment philosophy rather than make
short-term trades.
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
Accompanying Clients on their Investment Journey
Ant Fortune provided asset management companies with digital tools on the platform to help
consumers make better financial decisions. These tools included AI-powered Caifuhao, a smart
robot customer assistant ‘Super Ant’, live streaming of investment classes and information
sessions, an online investment forum, educational videos, and cartoons. Ant Fortune was
committed to building an investing community and working with the fund providers to
accompany investors at every step of their investment journey. Li Yimei, CEO of China Asset
Management (ChinaAMC), a Beijing-based asset manager established in 1998 and among the
first batch of nationwide mutual fund companies in China, felt the collaboration with Ant Fortune
helped ChinaAMC to reach consumers directly,
Unlike traditional sales models that relied primarily on banks and brokerages, online
platforms have drastically shortened the distance between consumers and fund houses. While
we provide offline investor education through traditional channels, the number of customers
you can directly influence is relatively limited. We can interact with more investors on the
Ant Fortune platform in a personalised way through live broadcasts and short videos.
Li also aimed to help investors understand market psychology and not get too emotional when
making investments,
I think that customers display many behavioural biases. We helped them to follow the creed
‘be fearful when others are greedy, and greedy when others are fearful’. In extreme market
volatility conditions, we run programmes in the live broadcast room to explain the situation
and eliminate the fear of the unknown. We have built a trust relationship with our customers
through the years and they value and tend to follow our suggestions at critical times.
She believed that investing could sometimes be counterintuitive; human beings were naturally
risk averse and would want to sell when markets were in retreat, but investment principles would
suggest taking the opposite course of action. However, investors who regularly watched the live
broadcasts tended to hold their positions 30 days longer than average investors.
Ant Fortune would regularly publish financial news and analysis on its platform. Making
investors more financially literate was considered an important part of the platform business.
Wang explained that it was important to provide information to users, especially novice investors,
Our inclusive finance efforts have attracted many first-time investors who may not
understand the concept of mutual funds or volatility. They are different from the high-networth users. Education is part of the business of our platform, and we have to help our users
gain financial literacy.
7/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
Taking care of the fund providers was only part of Ant Fortune’s task; it was extremely important
for the company to establish rules to ensure that the ecosystem was user-centric. Wang explained
that users could easily migrate to another internet platform due to the low switching costs,
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
If the market experiences severe volatility, our standard operating procedure is to publish an
article explaining the reasons for the volatility within two hours. Then we will delve further
into the reasons for the market volatility to see how it affects user positions. This is where we
can take full advantage of our platform, because I am not doing this alone, there are many
asset management institutions working with us to serve users.
We have a younger generation of users who are willing to share their views publicly on the
platform. In addition to our educational materials, we provide a space for key opinion
consumers to air their thoughts in the discussion and content community areas.
Even as consumers become more financially literate, they might not be able to evaluate every
available mutual fund product. Wang explained how technology could perform data analysis in
order to make investment recommendations,
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
Our own investment research team will vet the funds and then we will focus on the selected
funds that perform better. The funds we select must meet certain criteria: the first is that there
are excess returns, the second is that the fund’s investment principles do not drift, and the
third is that it has long-term investment returns. We also look at financial ratios such as the
price/earnings ratio and the Sharpe ratio to screen funds.
The Road Ahead
Ant Fortune was aware of its responsibility to promote sustainable business. Wang elaborated
on how that would maintain the company’s position as the most trusted platform for users and
fund houses,
Environmental, social, and corporate governance (ESG) investments in China are still in
their early days. There are some ESG-themed investment products on Ant Fortune, including
green bonds and funds related to carbon neutrality. Good corporate citizenship is not just to
provide ESG investment products, but to shoulder the responsibility it should play in the
society. The requirements of us by society are higher than those of others as there are many
users who made their first investment on our platform. The more users we serve, the higher
our standards and levels of self-discipline should be. We must take more responsibility to
shape a sustainable future.
The investment landscape in China was also expected to change over the coming years. Dou
predicted some of those changes,
On average, the performance of passive investment is better than that of active funds in the
mature US and European stock markets. The development of China’s fund industry is at least
30 years behind the US. We can gain an advantage over other investors through better
research but competition will eventually lower the alpha reaped by active managers. When
markets become more efficient, funds can just track the index. We can then save on research
costs.
As Wang was finishing her meeting, she felt proud that the Ant Fortune digital platform helped
many consumers access convenient and inclusive wealth management services. The platform had
served 500 million active users with assets under management at RMB4 trillion (US$605 billion).
Still, she knew she would have to continue working closely with stakeholders such as consumers,
fund providers and regulators to ensure that every citizen had access to investment opportunities.
8/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
Ant Fortune not only helped consumers through their technology but also allowed users to help
one another. Wang elaborated on the habits of the online community,
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
Source: Sina Finance, Survey on Debt of Urban Chinese Households in 2019, April 4, 2020,
https://finance.sina.com.cn/money/lczx/2020-04-24/doc-iirczymi8099086.shtml, accessed November 2022.
9/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
EXHIBIT 1: ASSET ALLOCATION OF CHINESE HOUSEHOLDS
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
Source: Sina Finance, Survey on Debt of Urban Chinese Households in 2019, April 4, 2020,
https://finance.sina.com.cn/money/lczx/2020-04-24/doc-iirczymi8099086.shtml, accessed November 2022.
10/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
EXHIBIT 2: FINANCIAL ASSET ALLOCATION OF URBAN HOUSEHOLDS
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
Source: East Money Information Co., 2020 White Paper on China's Wealth Management Industry
(Simplified Version) (in Chinese), May 27, 2021,
https://data.eastmoney.com/report/zw_strategy.jshtml?encodeUrl=61k8uBxHvBum4M47pCnRdf7Tm9y2LhL
9CKGmbTkHf24=, accessed November 2022.
EXHIBIT 4: DISTRIBUTION CHANNELS OF MUTUAL FUND PRODUCTS IN CHINA
Source: Asset Management Association of China, proportion of sales volume of public offering funds in each
channel, https://www.amac.org.cn/researchstatistics/datastatistics/fundsalesindustrydata/, accessed November
2022.
11/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
EXHIBIT 3: BREAKDOWN OF CHINA’S WEALTH MANAGEMENT MARKET (2015-2020)
SMU-22-0029
Ant Fortune: Providing Universal Wealth Management Services in China
EXHIBIT 5: SELECTED ANT GROUP BUSINESSES
Ant Group Digital Technologies is a global leader in blockchain, privacy computing, security
technologies, and distributed database. Since 2015, Ant Group has been investing significantly
in the research and development of blockchain technologies to strengthen transparency and build
trust in industries that traditionally involve large numbers of participants and complex processes.
Ant Group now has the largest productivity blockchain platform in China, with the ability to
process and support one billion user accounts and one billion transactions every day.
Source: Data provided by company
Educational material supplied by The Case Centre
Copyright encoded A76HM-JUJ9K-PJMN9I
EXHIBIT 6: SCREENSHOT OF ANT FORTUNE APP
This screenshot shows the Ant Fortune homepage with the different portals available to users.
Chinese users can also check out market news, view trending topics as well as join an information
session via livestream.
Source: Screenshot provided by company
12/12
Purchased for use by Saqib Sharif on 18-Sep-2024. Order ref F515428.
You are permitted to view the material online and print a copy for your personal use until 18-Sep-2025.
Usage permitted only within these parameters. This PDF may not be reproduced, stored in a retrieval system, or uploaded to any LLM (e.g. ChatGPT).
Mybank is an online bank that provided small loans to individual borrowers as well as small and
medium-sized enterprises. When a consumer applies online or by a mobile device for a loan,
Mybank’s automated vetting process would go through 100,000 indicators, 100 predictive
models and 3,000 loan strategies to determine if a loan should be made.