Nikko boss backs FMA on market manipulation

The boss of a local fund manager has welcomed efforts by the country's financial regulator to crack down on market manipulation.

Last week Milford Asset Management confirmed one of its employees was being investigated by the Financial Markets Authority over "certain specific trades".

And last month the market watchdog warned an "inexperienced" online trader, who wasn't named, over suspected manipulative trading.

In a Business Herald Meet the CEOs video interview, Nikko Asset Management NZ's managing director, Peter Lynn, said he supported the FMA stance on market manipulation.

"Investors just want to know their fund managers are treating their investments appropriately and abiding by all rules and regulations," Lynn said.

Nikko NZ, formerly Tyndall Investment Management, rebranded under its Tokyo-based parent company's name last year and has more than $4 billion in assets under management.

Lynn said one of the benefits of being part of a global company was the resources that could be put into risk management and compliance around trading best practice.

"We're very confident that our investors are getting absolutely pure investment returns and are benefiting from the market as they should. What we don't want to see is the market disturbed at all by inappropriate practices."

Milford managing director Anthony Quirk last week said the company and employee concerned were co-operating with the FMA.

The investigation had no implications for client funds and would not impact day-to-day operations, Quirk said.

Meanwhile, Lynn said there could be some life left in the equity bull run, which has seen stock markets rally for almost six years.

"We're clearly seeing a slowdown in the growth of that bull market but it's likely to perpetuate for a little bit longer," he said. "The reality is interest rates globally are so low, which provides stimulus to equity markets."