Tech heavyweights: Where now for the BATs?

Dominance by Chinese tech firms

Fund managers have said Asia's technology giants still have further to go after a strong run and are not looking overvalued, but have noted challenges for active managers as a few key players in the sector now form a substantial part of benchmark indices.

The weighting to the IT sector within the MSCI Emerging Markets index has nearly tripled from 10% to 29% over the last decade (see chart right), while in comparison the financials category (the largest sector in 2007) has stayed static at around 22%.   As with its FAANG counterparts in the US, the emerging market technology sector has powered ahead year to date, contributing half of the index's 30% returns. Six Asian stocks in particular have delivered 73% of this total, according to JPMAM. These were Chinese firms Baidu, Alibaba and Tencent (which together form the BAT acronym), as w...