As a portfolio manager at the nation’s central bank, this MAS scholar needs to stay abreast of global developments to make sure that the reserves are invested prudently to generate returns for the future needs of the country

Climate change is just one of the many things on Mr Huang Yiheng’s mind as he navigates the complexities of the investment landscape to achieve good long-term returns and manage risk in an increasingly volatile and closely connected world.

But the 30-year-old is no ordinary investor. He manages Singapore’s foreign reserves as a portfolio manager at the Reserve Management Department of the Monetary Authority of Singapore (MAS). Singapore’s Official Foreign Reserves include reserve assets such as bonds and equities, foreign currencies and gold held by the country’s monetary authority.

“As my team also drives MAS’ sustainable investing efforts, our job includes assessing how climate change can impact our portfolio’s long-term investment returns and risks,” explains Mr Huang. “Climate change introduces investment risks but also opportunities.”

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Risks like extreme weather events that damage the infrastructure of the companies MAS invests in will affect the portfolio’s returns. On the other hand, opportunities may lie in companies in low-carbon sectors like electric vehicle production which receive government subsidies and enjoy increased demand, making them more compelling for investment.

Geopolitics and other risks

Geoeconomic fragmentation is another emerging trend that plays a part in guiding MAS’ investment decisions.

Mr Huang likens his job scope to being a captain guiding a ship through unpredictable currents. “We must remain composed, steady the ship and navigate the portfolio through unpredictable markets,” he says.

He cites the rising tensions between the United States and China as an example. These tensions have not only reduced trade and investment between the two countries, but they have also reshaped global trade patterns and supply chains.

“While this causes slower growth and higher inflation globally, the impact differs across economies and assets,” he says. “Part of my job is to position our portfolio to manage the risks and seize opportunities in this uncertain and volatile environment.”

Under the MAS scholarship, he majored in mathematics and economics at Cornell University before enrolling in Princeton University for his master’s in finance. While at Cornell, he took classes in a diverse range of subjects like computer science, psychology, climate science, and Chinese culture and history.

The latter has proven useful in his current role as portfolio manager. It aids his analysis of how China’s domestic policy reforms and geopolitical developments affect its economy as well as the rest of Asia’s.

Even though the results of Mr Huang’s work may not be immediately evident, he feels immense satisfaction in his role at MAS.

“Our reserves are very important in Singapore and are a key asset in a crisis,” he says. “As a portfolio manager at MAS, I help to generate a valuable stream of investment income which can be spent or invested for the benefit of Singaporeans.”

Mr Huang was 18 when the global economy was slowly recovering from the global financial crisis. At the time, he had no idea what his ideal career would be – only an inkling of using his interest in mathematics and economics to find a meaningful job where he could make a difference.

“We must remain composed, steady the ship and navigate the portfolio through unpredictable markets.”

– Mr Huang Yiheng, recipient of the MAS Undergraduate Scholarship

At a scholarship fair in junior college, he learnt more about MAS’ role as a central bank and financial regulator as well as its breadth of responsibilities and functions.

“With the impact of the global financial crisis fresh on my mind, MAS struck me as somewhere I could apply my interests and knowledge,” he says.

Shortly after he took up his scholarship, he requested for an internship at MAS and was posted to the Anti-Money Laundering Department and later, the Economic Policy Group.

After he acquired his master’s, he joined MAS in 2018 as a financial regulator in the Prudential Policy Department where he helped develop bank capital and liquidity regulations that aim to increase the resilience of Singapore’s banking system. After three and a half years as a banking regulator, he took up his current role as a portfolio manager with the Reserve Management Department.

During the Covid-19 pandemic, many businesses slowed down due to the circuit breaker, affecting their cash flows. In 2020, Mr Huang was roped in to join a cross-department team tasked to work on MAS’ response to the crisis.

He worked with other government agencies and the financial industry to implement relief measures, including pausing loan repayments for borrowers and offering rent relief to small and medium-sized enterprises.

“It was a challenging period when we worked late nights and weekends to roll out the relief measures as soon as possible,” he recalls.

“But it was also incredibly fulfilling to know that our work had a direct and significant impact in supporting the economy and the well-being of Singaporeans.”

Later this year, Mr Huang will take up a posting in MAS’ London office where he will get to deepen his expertise in a foreign market that MAS invests in.

“I have personally benefited from this flexibility of taking on various roles within MAS – I have been an economist, a banking regulator and a portfolio manager. To me, this is one of the appeals of a career with MAS.”

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