Asiamoney Brokers Poll 2017: Best local - Taiwan

Yuanta Securities is the best local brokerage in Taiwan in Asiamoney’s Brokers Poll this year, as well as the best local research and sales house. 

Cathy Lee, head of cash equities, notes the firm's heavy investments in IT have made all the difference in keeping up with the changes in the marketplace and the demand for electronic and low latency trading.

“All the clients are focused on the e-trading floor and speed of execution,” she says. “So we keep upgrading our IT infrastructure for PC and mobile apps.”

This was made all the more crucial by the fact that Yuanta has acquired a number of other brokers over the years, leading to a situation where five different trading platforms coexisted within the firm. 

Not that having boots on the ground has stopped being crucial. The firm has some 150 branches across the country, and the army of sales agents means the firm competes across the board with local brokers.

Vincent Chen, head of regional research and top Taiwan strategist, adds that the firm has distinguished itself on a few key market calls this year. Stock calls made at the start of the year include General Interface Solution, part of Apple’s supplier ecosystem, and Chunghwa Precision Test Tech. Their stocks have risen 150% and 30%, respectively.

Yuanta has managed to outperform also by staying consistent on certain names, Chen says. 

Foreign investors, in particular those from Europe, have flocked to the market, buying into the kind of stocks for which Taiwan is well known, such as Taiwan Semiconductor Manufacturing.

“It's of essence finding the few key names, a bit like buying Tencent stocks in Hong Kong,” Chen says.

After a quiet 2016 in terms of volumes, this year's scrapping of capital gains tax has proved a boon for the local market.

“The market reached a new high; local investors are willing to participate more,” says Chen. “The high net-worth individuals are coming back and will trade more as well. Last year, foreign investors were 26% of the whole market, but this year the average is less than 22%.”

As a result, the firm expects overall trading volume to double by 2018, compared with 2016. The surge in trading volume is accompanied by a push on e-trading, currently below 50% of volumes on the Taiwan Stock Exchange but targeted to be 80% by the end of 2019.