Monthly Archives: February 2021

At this point, 2020 needs no introduction. In a single year, the Covid-19 pandemic claimed millions of lives around the world and wiped out trillions of dollars from the global economy. It changed the way most people work and live, and has left a lasting imprint on virtually every industryincluding the asset management firms that collectively oversee about $29 trillion in mutual funds and exchange-traded funds.

If ever there was a year for active managers to prove their mettle, it was last year. Granted, investors who rode it out in an index fund would have done just fine: The Vanguard S&P 500 ETF (ticker: VOO) returned 18% in 2020. But it was a wild year for many active fundsespecially the more than two dozen stock funds that returned at least 100% in what is almost certainly a first in the history of the industry.

Record-setting returns helped propel many of the top-ranked fund families up the leaderboard in this years Barrons Fund Family Ranking, based on data from Refinitiv Lipper. But that wasnt the case for every company. In fact, the No. 1-ranked fund family, Manning & Napier, credits its strong performance to asset allocation. The runner-up, Guggenheim Investments, took its spot thanks to a bold call on the bond market.

The next two firms, No. 3-ranked Vanguard and Fidelity Investments at No. 4, are both massive fund complexes but quite different when it comes to their actively managed stock funds: Vanguard relies primarily on outside advisors, while Fidelity has one of the largest in-house research teams in the business.

Rounding out the top five, No. 5-ranked Morgan Stanley Investment Managementwhich debuted on our ranking in 2019 at No. 47made its mark in 2020 thanks largely to its Counterpoint Global team, which ushered five different funds to returns exceeding 100% for the year.

See previous years rankings:

As has been the case for the past two decades, Barrons Fund Family Ranking looks at the one-year relative performance of fund firms that offer a diversified lineup of actively managed mutual funds and ETFs. The ranking eliminates index funds, so results are based on firms skill in active management. The ranking itself is purely quantitative, yet behind the fund tickers and track records are individuals. They all have their own stories of relocating to home offices and contending with different strokes of personal disruptionduring the worst market selloff in history and one of the fastest recoveries on record.

To qualify for this ranking, firms must offer at least three active mutual funds or actively run ETFs in Lippers general U.S. stock category; one in world equity; and one mixed-asset, such as a balanced or allocation fund. They also need to offer at least two taxable bond funds and one national tax-exempt bond fund. All funds must have a track record of at least one year. While the ranking excludes index funds, it does include actively managed ETFs and smart beta ETFs, which are run passively but built on active investment strategies.

All told, just 53 asset managers out of the 822 in Lippers database met our criteria for 2020. The list varies from year to year, as firms merge, get acquired, or add or drop funds. After liquidating its mixed-asset funds, Aberdeen Standard Management dropped off this years ranking. Legg Mason is another notable firm thats no longer on the list; Franklin Templeton acquired the firm in 2020. Many other large fund managers are consistently absent because they dont check all of the boxes in the categories we consider. Notable names in this category include Janus Henderson, Dodge & Cox, and Charles Schwab Investment Management.

Active investing comes in many forms, but human decision-making is always part of the process, whether it entails picking individual stocks and bonds, creating and improving factor-based models, or making big-picture calls that affect multiple portfolios.

The first thing that went right for us was asset allocation, says Ebrahim Busheri, director of investments at Manning & Napier. The 50-year-old Rochester, N.Y., firm was an early adopter of asset-allocation funds and began offering life-cycle strategies in 1988, decades before the industry embraced them. Heading into the March selloff, the firms multi-asset portfoliosincluding four Pro-Blend fundsunderweighted equities, not because Busheri and his colleagues predicted the pandemic, but because they thought it was the late stages of the economic cycle and that valuations had gotten ahead of themselves.

When markets plummeted 34% in late February and March, the managers quickly changed course. We are truly an active manager, and when theres volatility, theres the potential to benefit. says Busheri.

The firms largest allocation fund, the $695 million Manning & Napier Pro-Blend Extended Term (MNBAX), went from a 46% allocation to stocks in February to 59% by the end of March. The fund returned 17.6% in 2020, better than 96% of its Lipper peers, and with less risk than the market. The funds maximum drawdown during the selloff last spring was 19%.

While allocation decisions set the tone, performance was also a function of security-specific decisions. We tend to grow our own talent, says Busheri, who joined the firm after getting his M.B.A. at the University of Rochester. Its easier to implement a specific strategy when you train analysts to think that way from day one.

On the equity side, the firm categorizes holdings into three main buckets: profile companies are growth stocks with sustainable competitive advantages; hurdle rate companies are out-of-favor cyclical companies; and bankable deals are companies whose parts are greater than their market value. During the selloff last spring, Manning & Napier managers focused primarily on buying or adding to their positions in profile companies such as Amazon.com (AMZN), PayPal Holdings (PYPL), and ServiceNow (NOW).

See Barrons Best Fund Families of 2020 rankings below. Scroll down to read the rest of the article.

*Total assets reflect the funds included in the survey. **Victory Capital acquired USAA in July of 2019, but the fund families are ranked separately. (To view all the columns in the table, please use the scroll bar located at the bottom of the table.)

Source: Refinitiv Lipper

To view all the columns in the table, please use the scroll bar located at the bottom of the table.

Source: Refinitiv Lipper

To view all the columns in the table, please use the scroll bar located at the bottom of the table.

Source: Refinitiv Lipper

To view all the columns in the table, please use the scroll bar located at the bottom of the table.

Source: Refinitiv Lipper

To view all the columns in the table, please use the scroll bar located at the bottom of the table.

Source: Refinitiv Lipper

To view all the columns in the table, please use the scroll bar located at the bottom of the table.

Source: Refinitiv Lipper

Though stocks dominated the headlines, some of the biggest dislocations last March were in the bond market. Heading into 2020, Anne Walsh, chief investment officer of fixed income at No. 2-ranked Guggenheim Investments, and her colleagues battened down the hatches, thinking that most bonds were priced to perfection. Then came the coronavirus, and things pivoted almost overnight, she says, recounting how redemptions in riskier corporate bonds exacerbated losses for managers who were forced to sell. Meanwhile, companies issued new bondswith significantly higher yields than a couple of months priorto raise capital to weather the crisis. This opened the door for Guggenheim to go shopping.

After lagging behind its benchmark in 2019, the $25 billion Guggenheim Total Return Bond fund (GIBIX) returned more than 15% in 2020, and beat nearly all of its Lipper peers. Likewise, the $6 billion Guggenheim Macro Opportunities fund (GIOIX) returned 11.6% to rank at the top of its peer group.

Guggenheim offers a diverse lineup of funds, but most of its $246 billion in assets under management are in fixed income. Guggenheim is adept at turning market dislocations in its favor. It cleaned up after the 2008-09 financial crisis, and in 2014, following the taper tantrum, the Total Return Bond fund returned 8.3%outpacing most of its peers.

Still, last year was its own story, namely because things snapped back so quickly, says Walsh. The company tries to minimize behavioral biases that often lead to second-guessing through its organizational structure. Guggenheims 214 fixed-income investment professionals, who are based primarily in Santa Monica, Calif., and New York, work in four groups, each focused on macroeconomics, portfolio construction, security analysis, and portfolio management.

The market has bounced back, but Walsh and her colleagues say there is still room for yields on riskier bonds to move closer to their risk-free equivalents. Nothing moves in a straight line, but generally speaking, the trend is toward tighter spreads, she says.

This years No. 3 spot goes to Vanguard. The $7.1 trillion manager is best known as a powerhouse in index investing, but its $1.7 trillion in actively managed fundssplit evenly between equity and fixed incomemakes it one of the largest active investors in the world. Vanguard doesnt do much stock-picking in-house; most of the firms active equity funds are managed by outside advisors, as has been the case since John Bogle founded Vanguard to handle the administrative functions of his previous employer, Wellington Management.

Working with subadvisors allows Vanguard to seek out the best talent in any given area and keep costs low, says Kaitlyn Caughlin, who is a principal and head of Vanguards Portfolio Review Department, charged with developing and maintaining funds managed in-house and by roughly two dozen outside firms.

In the case of the $71 billion Vanguard International Growth fund (VWILX), subadvisors Schroder Investment Management and Baillie Gifford delivered a nearly 60% return in 2020, thanks to long-term positions in top performers like Alibaba Group Holding (BABA), Tencent Holdings (TCEHY), and Tesla (TSLA).

Wellington Managements Don Kilbride has run the $45 billion Vanguard Dividend Growth fund (VDIGX) since 2006 with a philosophy that rising dividends are both a byproduct and harbinger of high-quality companies that can compound returns, even in tough environments. Top holdings such as UnitedHealth Group (UNH), Nike (NKE), and Johnson & Johnson (JNJ) contributed to the funds 12% return last year, better than 85% of its Lipper peers.

The $48 billion Vanguard Windsor II fund (VWNAX) also helped Vanguards overall standing. It returned 14.5% in 2020 to edge out most of its large-value peersthough some of its larger holdings, such Apple (AAPL) and Alphabet (GOOGL), arent prototypical value stocks. Its considered a value manager, but certainly not in the way we think of value, says Daniel Wiener, chairman of Adviser Investments and senior editor of the Independent Adviser for Vanguard Investors.

Last year, 83% of the firms active fixed-income fundsmost of which are managed in-houseoutperformed their respective benchmarks. That includes the $74 billion Vanguard Short-Term Investment-Grade (VFSUX) and $37 billion Vanguard Intermediate-Term Investment-Grade (VFIDX) funds, which were up more than 5% and 10%, respectively, in 2020, putting them in the top decile of their Lipper peers. Smart investment decisions drive performance, but low feesas in an average asset-weighted expense ratio for Vanguard actively managed bond funds of 0.11%are part of the equation. In a low-yield fixed-income environment, ultralow expenses win the day, Wiener says.

Whereas Vanguard outsources most of its fundamental equity research, No. 4-ranked Fidelity has one of the largest in-house research departments in the businesshundreds of equity and credit analysts collectively calling the shots on most of its $2.5 trillion in actively managed assets. In a typical year, Fidelitys research team has more than 13,000 face-to-face meetings with companiesa process that went virtual in a matter of days last spring.

Tim Cohen, co-head of equity, says that he and his colleagues look forward to the time when they can kick the tires in real life. For now, there are positives. As active managers, we benefit from change, Cohen says, noting that collectively, Fidelitys equity funds outperformed their benchmarks by 8.9 percentage points.

Meanwhile, the virtual world makes it possible to defy physics. For all its downside, there was at least one upside in 2020: I was able to be in a few places at one time, says Sonu Kalra, manager of the $40 billion Fidelity Blue Chip Growth (FBGRX). For example, I could attend health care, tech, and consumer conferencesvirtuallyall on the same day. Thats not possible if you have to travel to California, New York, and Florida.

Because Barrons rankings are asset-weighted, a firm tends to rank high when its larger funds post strong relative performance. That was the case for Kalras fund, which returned 62% in 2020, better than 98% of its peers. The same was true of the $45 billion Fidelity Growth Company (FDGRX) which returned 68%. Though it returned more than 32% last year, Fidelitys $132 billion Contrafund (FCNTX) landed in the bottom third of its peer group, detracting from the firms overall score. Contrafunds 2020 problem, in short, according to manager Will Danoffs letter to shareholders: too much Berkshire Hathaway (BRK.A) and not enough Apple.

On the fixed-income side, many of Fidelitys bigger contributors are part of Fidelitys Strategic Advisers series. The funds arent available directly to retail investors or through financial advisors, but they are included in the ranking because they are the basis of a growing segment of separately managed accounts, which are available primarily through individual and workplace retirement plans.

Finally, No. 5-ranked Morgan Stanley Investment Management made its first appearance in the ranking in 2019 and climbed the ranksin a big wayin 2020. The asset management arm of Morgan Stanley has no central investment research office or chief investment officer calling the shots. Rather, more than 20 autonomous teams specializing in a wide range of public and private markets manage $781 billion in assets.

In 2020, Morgan Stanley announced that it would acquire Eaton Vance (No. 48) in a deal expected to close in the second quarter of 2021. Given that there is little overlap in focus areas Eaton Vance brings deep expertise in municipal bonds and owns Calvert Research & Management, a leader in sustainable investingit isnt expected to dramatically change how Morgan Stanley teams manage money.

We have a lot of diverse views, and typically, smaller decision-making groups tend to succeed, says Dennis Lynch, head of the Counterpoint Global team, which manages about $150 billion in 19 growth-oriented strategies. And talk about succeeding: Five of the mutual funds managed by Lynchs team returned more than 100% in 2020. Relative underperformance in 2019 (Morgan Stanley ranked 47th last year) helped to slingshot results in 2020. Many of our companies were underappreciated coming into 2020, Lynch says. And many benefited from quicker [Covid spurred] adoption of secular trends already in their favor.

The $20 billion Morgan Stanley Institutional Growth (MSEQX) returned 115%. Like many top performers in 2020, it was an early investor in companies that benefited from the sudden shift to all things digital. Zoom Video Communications (ZM) and Shopify (SHOP) were two outsize contributors last year. Similar themes played out in the teams other funds, including Morgan Stanley Insight (CPOAX) and Morgan Stanley Discovery (MPEGX), which were up 116% and 142%, respectively, as well as small-cap growth fund Morgan Stanley Inception (MFLLX) and world stock fund Morgan Stanley Global Endurance (MSJSX).

Lynch says that Counterpoint Global doesnt invest in themes, but the team does spend a lot of time thinking about the impacts of secular trends. Five members of the team are in charge of researching disruptive changeareas that range from, say, artificial intelligence to gene editing. The team has long had a book club, and now that Zoom is ubiquitous, it has started inviting authors to join the online discussions. Recent guests include David Epstein, author of Range, and Abigail Marsh, author of The Fear Factor.

Carving out time to think about big ideas is important for long-term returns, says Lynch, but so is making sure that everyone is on the same page.

*Victory Capital acquired USAA in July of 2019, but the fund families are ranked separately.

Source: Refinitiv Lipper

*Victory Capital acquired USAA in July of 2019, but the fund families are ranked separately.

Source: Refinitiv Lipper

All mutual and exchange-traded funds are required to report their returns (to regulators as well as in advertising and marketing material) after fees are deducted, to better reflect what investors would actually experience. But our aim is to measure manager skill, independent of expenses beyond annual management fees. Thats why we calculate returns before any 12b-1 fees are deducted. Similarly, fund loads, or sales charges, arent included in our calculation of returns.

Each funds performance is measured against all of the other funds in its Refinitiv Lipper category, with a percentile ranking of 100 being the highest and one the lowest. This result is then weighted by asset size, relative to the fund familys other assets in its general classification. If a familys biggest funds do well, that boosts its overall ranking; poor performance in its biggest funds hurts a firms ranking.

To be included in the ranking, a firm must have at least three funds in the general equity category, one world equity, one mixed equity (such as a balanced or target-date fund), two taxable bond funds, and one national tax-exempt bond fund.

Single-sector and country equity funds are factored into the rankings as general equity. We exclude all passive index funds, including pure index, enhanced index, and index-based, but include actively managed ETFs and so-called smart-beta ETFs, which are passively managed but created from active strategies.

Finally, the score is multiplied by the weighting of its general classification, as determined by the entire Lipper universe of funds. The category weightings for the one-year results in 2020 were general equity, 35.6%; mixed asset, 20.7%; world equity, 17.3%; taxable bond, 21.9%; and tax-exempt bond, 4.8%.

The category weightings for the five-year results were general equity, 36.2%; mixed asset, 20.9%; world equity, 16.9%; taxable bond, 21.6%; and tax-exempt bond, 4.4%. For the 10-year list, they were general equity, 37.5%; mixed asset, 19.5%; world equity, 17.3; taxable bond, 20.8%; and tax-exempt bond, 4.8%.

The scoring: Say a fund in the general U.S. equity category has $500 million in assets, accounting for half of the firms assets in that category, and its performance lands it in the 75th percentile for the category. The first calculation would be 75 times 0.5, which comes to 37.5. That score is then multiplied by 35.6%, general equitys overall weighting in Lippers universe. So it would be 37.5 times 0.356, which equals 13.35. Similar calculations are done for each fund in our study. Then the numbers are added for each category and overall. The shop with the highest total score wins. The same process is repeated to determine the five- and 10-year rankings.

Email: editors@barrons.com

Read the rest here:

Barrons Best Fund Families of 2020 - Barron's

Eighteen months ago, Malcolm was at the vanguard of Hong Kong's pro-democracy movement.

Full of bravado and often clad in black, the 21-year-old oversaw a group of 60 combative front-liners who embraced confrontational tactics against the police while demanding greater democracy in the former British colony.

Today, he is applying for asylum in the United Kingdom, and separated from his family in Hong Kong where he feels he can longer visit. Malcom believes if he returns to the Chinese city he could be arrested under a sweeping national security law imposed by Beijing on Hong Kong last June, which scaled up penalties against dissent to include punishments as severe as life imprisonment.

Since then, nearly 100 activists have been arrested under the new law. When Hong Kong police apprehended a protester friend of Malcolm's in October, he booked a red-eye flight to London. Malcolm asked CNN not to use his real name, for fear that his family -- who remain in Hong Kong -- could face repercussions.

The British government has called the security law a clear violation of the "one country, two systems" policy meant to ensure Hong Kong's autonomy from Beijing until 2047. In its wake, the UK has opened a six-year pathway to British citizenship for holders of British National (Overseas) passports (BN(O)), a special visa category created for Hong Kong nationals before the 1997 transfer of power.

The visa does not account for the most vulnerable Hong Kongers: young pro-democracy protesters, like Malcolm, who were born after 1997 and are therefore not eligible. But it is nonetheless remarkable in its scope -- in a city of 7.5 million people, 5.2 million Hong Kongers and their dependents are eligible for it.

It's also remarkable for another reason: it has been pioneered by the same British politicians who engineered the UK's break from the European Union, in part, to curb immigration.

It sets a markedly different tone for the Conservative government, and its cheerleaders in the British press, who have spent the past decade pushing anti-immigrant policies. And critics say it is predicated on a flawed idea of Hong Kongers as a "model minority" who will need no support to settle into a new life in the UK.

The UK voted to leave the European Union in 2016 following a campaign dominated by anti-immigration rhetoric -- much of it emanating from the same politicians who are now running the government.

In one campaign missive, pro-Brexit lawmakers Boris Johnson, Priti Patel, and Michael Gove stoked fears that rising numbers of southern European immigrants would "put further strain on schools and hospitals," and that "class sizes will rise and waiting lists will lengthen if we don't tackle free movement."

Yet last June, Prime Minister Boris Johnson announced the visa pathway for millions of Hong Kongers, describing the offer as being "one of the biggest changes in our visa system in history." The same politicians and media houses that warned darkly of an influx of foreigners during the Brexit campaign raised few objections this time around.

Last month, Priti Patel, now the Home Secretary, said she looked forward to welcoming Hong Kongers "to our great country." Yet in 2016, Patel campaigned against what she described as "uncontrolled migration" from the EU, and last year she is reported to have considered plans to send those seeking asylum in the UK to two Atlantic islands more than 4,000 miles away.

Welcoming Hong Kongers has become one of the few issues in British politics that commands bipartisan support, uniting opposition Labour, Green Party and Scottish National Party members with the hawkish, anti-China wing of the Conservative party.

The British government's shift in attitude could echo a change in public opinion -- migration concerns in the UK appear to have softened considerably in recent years. The jury is out as to why public attitudes have shifted, but it has coincided with immigration dropping off the agenda as a political issue in the past few years.

There is also a feeling of colonial "indebtedness" to the people of Hong Kong, says Jonathan Portes, a Professor of Economics and Public Policy at King's College London.

Some of Brexit's biggest backers are championing the scheme "in a pretty explicit break with the approach of [Margaret] Thatcher in the run up to 1997," Portes said, explaining that the late UK Prime Minister "wanted to limit, as much as possible, the number of Hong Kong Chinese who came here, because of her wider anti-immigration views."

Defending Hong Kong against the creep of authoritarianism has also become a moral issue in the UK, which has hardened its attitude towards China in the past year. The UK has barred Chinese telecoms giant Huawei from playing a part in the country's 5G network, and has been vocal in its criticism of Beijing for human rights abuses against Uyghurs and other minorities in the Xinjiang region.

Perhaps one of the reasons the Hong Kong visa scheme has been so lauded is that its recipients are also being sold to the British public by hardline Brexiteers as a caricatured model minority, say critics.

Hong Kong nationals "wouldn't cost our taxpayers a penny... [they] would bring their own wealth," Conservative peer Daniel Hannan wrote in the right-wing Daily Telegraph newspaper. "And once they arrived, they would generate economic activity for the surrounding region, just as they did in their home city."

The Home Office estimates that up to 153,700 BN(O) holders will arrive in the country this year -- and estimates they could bring 2.9 billion ($4.1 bn) into the economy over five years.

Yet the reality might not be so clear cut.

Hong Kong has one of the highest GDPs per capita in the world, but it is also one of the most economically unequal places on the planet, where one in five people are estimated to be living in poverty.

A family of two adults and two children will have to pay as much as 12,000 ($16,600) in immigration-related fees and have more than 3,100 in the bank in savings, according to the UK Home Office, and that doesn't include flights.

The language barrier (forms will need to be completed in English), and having to demonstrate the ability to accommodate and support themselves for at least six months, are also likely to put some off.

"60% of the people in Hong Kong live in public housing estates and they would find it harder [compared to Hong Kong's white-collar workers] to settle in a foreign country," Chan added.

Nor is it straightforward for those who are able to scrape the funds together, campaigners say. A study by civil society group Hong Kongers in Britain found that the majority of people planning to take up the visa are highly educated and financially able to support themselves through the move. Yet their main concerns about the move are finding accommodation, living costs, finding a job, and integrating into British society. More than a quarter of those surveyed worried about having trouble communicating in English.

Another challenge is the support that awaits them when they arrive in the UK.

The UK does not have a formal national integration program for immigrants. And there is no nationwide integration plan for the Hong Kongers who emigrate under the new scheme, according to Fred Wong, who works with Hong Kong ARC, a civil society group which offers Hong Kongers legal and mental health support. Wong asked CNN not to use his real name because he still has family in Hong Kong and fears for their safety.

Some of the 40 Hong Kongers who Wong is currently helping in the UK have yet to finish university or high school, while around half have never held down a job before and are struggling to get on the ladder in the UK. The UK government has no provisions to help them find jobs, set up bank accounts, or access mental health support, Wong said.

"Most of them suffer from PTSD [post-traumatic stress disorder], which could be a reason or excuse [to why] they are not progressing," Wong said. His group has been organizing free psychological consultations and talks on how to overcome insomnia, nightmares and stress, as many of the Hong Kongers Fred helps have had trouble sleeping since fleeing the territory.

The model minority narrative means that the UK government is "unprepared, and maybe a bit oblivious to the amount of support that's needed," Wong said.

"The UK government is working alongside civil society groups, local authorities and others to support the effective integration of BN(O) status holders and their families who choose to make our United Kingdom their home," UKs Minister for Future Borders and Immigration, Kevin Foster, told CNN in a statement.

Polls show that the majority of British voters support the BN(O) scheme, but attitudes could shift as an estimated 300,000 BN(O) holders arrive in the next five years, Tanja Bueltmann, a professor of migration and diaspora at the University of Strathclyde, told CNN.

"The [ BN(O) scheme] is genuinely well meaning, but the provision around it is not very good," she explained -- something that raises questions over how many Hong Kongers will make the move in the end.

The other worry is Hong Kongers will face racially aggravated violence at a time of increasing xenophobia against people of East Asian appearance in the UK. Figures from London's Metropolitan Police showed that people who self-identified as Chinese, and whose ethnic appearance was recorded as "Oriental," experienced a five-fold increase in racist crimes between January 2020 and March 2020. Polling done in June found that three quarters of people of Chinese ethnicity in the UK had experienced being called a racial slur.

During an October debate on racism against the Chinese and East Asian community in Parliament, Scottish National Party lawmaker David Linden said some of his constituents "described the attacks against them, with restaurants and take-outs being vandalized and boycotted and victims being punched, spat at and coughed on in the street and even verbally abused and blamed for the coronavirus pandemic."

London-based Hong Kong Watch and 10 other civil society groups wrote to the government in January expressing concern about the lack of a "meaningful plan in place to ensure that the new arrivals properly integrate ... local authorities do not have specific policies, strategies or the creative bandwidth to welcome and integrate Hong Kong arrivals into their communities."

"The government must learn the lessons from past failures and take pre-emptive action now," their letter read.

In the meantime, up to 350 Hong Kong dissidents between the ages of 18 and 24 are believed to be currently "stuck in limbo" in the UK, according to Wong from Hong Kong ARC. Being born after 1997, they are not eligible for the BN(O) scheme.

Some are in the country on tourist visas, biding their time until the UK government creates a policy that considers them, or until Canada begins its planned work-visa pathway for young Hong Kong dissidents. Australia has offered a pathway for permanent residency for Hong Kong students and skilled workers currently in the country.

But pandemic-related travel restrictions, as well as a lack of funds, mean many have had to rely on the generosity of civil society groups for a stipend, food and even accommodation.

Others, like Malcolm, have already applied for political asylum in the UK. The process can take more than a year. Asylum seekers are not allowed to work or open a bank account while their claim is being processed; they will be charged higher international fees if they attend a UK university.

And campaigners say there is no guarantee that pleas for asylum will be granted. According to the Refugee Council, in the year to September 2020, only 49% of initial decisions by the Home Office resulted in a grant of asylum or other form of protection.

Many asylum-seekers instead have to rely on asylum appeals through the courts to provide them with refugee status.

"The pro-democracy protests would not have existed without them [young activists], and without the protests there would not have been the BN(O) scheme -- but they're the ones who are being left behind," said Chan.

Malcolm says he is luckier than most, having a sizeable inheritance to survive on, and a network of contacts that helped find him accommodation outside London. He hopes to apply for college once he gains asylum, but in the meantime has started to financially support around 20 dissidents in the UK and Hong Kong. He says that the British government has not done enough to help his generation.

Hong Konger Sze, who asked CNN not to use her full name because her family still lives in Hong Kong, quit her job as a high school geography teacher and came to the UK in October on holiday to visit some friends.

At the end of her two-week trip, Sze decided to stay. She told CNN she plans to apply for BN(O) visa at the end of this month and is living off her savings in a flat she rents with a friend in North London in the meantime. Sze has been looking into roles as a geography teaching assistant or tutor as her Hong Kong teaching qualifications are recognized in the UK. When asked if her halting English will be a liability, Sze says "practice makes perfect."

The 28-year-old said China's incursion into everyday life in Hong Kong had influenced her decision to stay, as had the fact that being in the UK means she has the "freedom to do what I want and even protest every week," without fear of political retribution.

It would be intolerable to live in Hong Kong now, especially since teachers have been compelled to "teach students about the [national] security law," she said.

Sze has settled into London life: She already has strong opinions on the snail's pace of London buses and is counting the days to when lockdown ends and she can go shopping on Oxford Street.

While it can be hard to find the authentic Cantonese cuisine she grew up eating in Hong Kong, Sze marvels at how much cheaper food is at British supermarkets.

"The food quality is better, the price is cheaper and the rent is cheaper," she told CNN.

Sze cannot get a job until her BN(O) visa is approved, but she is optimistic that the UK's coronavirus-induced economic slump will not get in the way of her finding work. "I am open to any [job] option -- it really depends on how much savings I have," she said.

But her biggest concern is the fate of fellow dissidents going through the asylum process, and whether her compatriots who move to the UK will give up the fight for independence back home.

"Hong Kongers should never give up, no matter if they've left Hong Kong or not," she said.

More here:

Why Britain's anti-immigration politicians are opening the doors to thousands of Hong Kongers - KCTV Kansas City

Is Xi Jinping more Hitlerian or Stalinist in his view of Chinese socialism? The answer to that question is important because it bears on the policy choices Chinas adversaries will need to make.

George Kennan, the godfather of Americas policy of containment of the Soviet Union, made clear in his 1946 long telegram that Adolf Hitlers vision of national socialist modernity wasnt a force that could be contained; the reason was that Hitler had a timetable according to which the Third Reich was to achieve global domination and his strategy could be thwarted only by annihilating Nazism by means of total war. The Soviet Union, in contrast, could be contained through Western domestic resilience and a resolve to counter territorial revanchism. That was because Joseph Stalin had in mind no specific time by which the world would need to reach the communist phase of development.

Precisely where Xi Jinping sits on the spectrum of totalitarianism is a matter of dispute. Elements of Xis ideology are notably Hitlerian. His ambition to achieve the great rejuvenation of the Chinese nation introduces a nationalist character to the Chinese Communist Partys understanding of socialism. Unifying China and Taiwan is one revanchist mission driving Xis great rejuvenation, but revanchism is only one part of the nationalism Xi has begun to emphasise in CCP ideologymilitarism and capitalism are the others. Writing in the CCPs premier theoretical journal, Seeking Truth (), staff from Chinas National Defense University argue that a rich nation and a strong military are two cornerstones of the great rejuvenation of the Chinese nation. Chinese socialism seems not to be driven by the Marxian desire to secure a path to communism, but by the militarist ambition for armed strength and the capitalist will for material prosperity. Xis new era for Chinese socialism undermines traditional Marxism-Leninism, which views those nationalist forces with contempt.

Does it matter whether Chinese socialism becomes more nationalist than Marxist under Xi? According to Hitler, the distinction between national socialism and Marxian socialism was of paramount importance. Socialism is the science of dealing with the common weal. Communism is not Socialism. Marxism is not Socialism. The Marxians have stolen the term and confused its meaning, Hitler declared in a 1923 interview with George Sylvester Viereck. To Hitler, Marxisms rejection of both the legitimacy of the nation-state and the capitalist forces of production was a fundamental error. Socialism, unlike Marxism, does not repudiate private property. Unlike Marxism, it involves no negation of personality, and unlike Marxism, it is patriotic, Hitler said. His embrace of nationalism and of capitalism had important implications for the Third Reich. Our socialism is national, he argued. We demand the fulfilment of the just claims of the productive classes by the state on the basis of race solidarity. To us state and race are one.

Hitlers distinction between national and Marxian socialism has important implications for the CCP under Xi. The party has allowed China to undergo capitalist industrialisation since Deng Xiaoping, having repudiated Maoist collectivisation, but remained committed to a strong supervisory state. The political economy Xi has inherited is thus similar to the economic structure Hitler presided over in the Third Reich. The problem for the CCP, however, is that Chinas state-supervised yet market-oriented economy necessarily repudiates any notion of socialism being driven by Marxism. To a political party that supposedly follows traditional Marxism-Leninism, that contradiction constitutes an existential threat. The way to negate it, for Xi, is to unify state and race by integrating nationalist notions of Chinas great rejuvenation into CCP ideology. Chinas economic model has forced Xi to take a leaf out of Hitlers book.

The CCP can never disclose the national socialist forces behind Xis vision for China. Leninism remains crucial to the partys identity as a revolutionary agent for historical change, while Stalinism remains critical to the CCPs organisation as a vanguard party securing a path to communism. As Xi said to the partys 18th National Congress in 2012, To dismiss the history of the Soviet Union and the Soviet Communist Party, to dismiss Lenin and Stalin, and to dismiss everything else is to engage in historic nihilism, and undermines the [CCPs] organisations on all levels. Xi cant acknowledge the national socialist character that his ideology has taken on, lest he be accused of undermining the legacies of Lenin and Stalin.

Nor can he repudiate the legacies of Mao Zedong and Deng Xiaoping. Many commentators note that Xis response to his family being sent to labour camps during the Cultural Revolution was to become redder than red. That experience drilled into Xi a deep respect for Mao as the inheritor of Stalins legacy and as the father of the CCP. But the unique position Deng occupies in CCP historiography is also relevant. As the cadre who introduced market-oriented reforms at the Third Plenum of 1978, Deng kicked China out of agrarian feudalism and pushed the country closer to the communist phase of development. Xi can repudiate neither Mao nor Deng, lest he be accused of the very historical nihilism he says he abhors.

How might Xi interpret his own place in CCP history? Lenin and Stalin may have been the worlds first true socialists, but the early leaders of the CCP believed that socialism had to be indigenised in China. Mao and Deng, being true Marxist-Leninists, saw that process of indigenisation as a necessary by-product of Chinas relative lack of social development. For Mao, the nationalisation of socialism was a necessary part of winning a revolution in Chinas largely agrarian society. For Deng, nationalising socialism was but the petit bourgeois result of capitalist industrialisation. Xi, however, views leadership in terms of a sacred bloodline and believes nationalism to be essentially ethnic. He probably sees the nationalisation of socialism as his personal mission on behalf of the Chinese nation.

National socialist images of a sacred bloodline have now become a feature of CCP ideology. Su Jingzhuang (), from the Central Party School, recently wrote an article on Xi Jinping thought in the Study Times (), arguing: Red genes are a genetic factor that has taken root in the body of our party and flows through the blood vessels of CCP cadres; they [form] the spiritual lineage of the Chinese races coexistence and co-prosperity, and [they are] a core political advantage in realising the great rejuvenation of the Chinese nation. The national socialist mission of unifying race, party, nation and state seems to have taken on singular import for the CCP, while its Leninist role of securing a path to communism has been subordinated. Nationalism is no longer a necessary step on the road to communism, but the driving force behind Chinese socialism.

Under Xi, the CCP has proven all too willing to incorporate aspects of Hitlerian national socialism into its mode of governance. Carl Schmitt, known as the crown jurist of national socialism, has been cited by legal advisers to Chinas leadership to rationalise the CCPs imposition of a new national security law on Hong Kong last year. Schmitts central argument was that the sovereign, as someone who decides on exceptions to rules, has a necessary power to suspend civil liberties. That the CCP is now incorporating Schmitts fascist jurisprudence into its legal regime indicates that Chinas ruling elite has been influenced not only by the ideological elements of national socialism but also by Nazisms governmental aspects.

How long Chinese socialism will continue to nationalise under Xi remains an open question. But one thing has become clear: the CCPs role in securing Chinas path to communism is being subordinated to Xis vision for Chinas nationalist resurgence. The likeliest result of this phenomenon is a less patient, more erratic and risk-hungry foreign policy. Indeed, the prominence of Beijings wolf warrior diplomats and the CCPs track record of economic coercion are good indicators that Chinese foreign policy is already taking on that distinctly Hitlerian quality. Yet, the CCP itself remains steeped in Marxism-Leninism and retains a deep respect for Joseph Stalin. Ironically, it may be those Stalinist traditions that could save the world from a Xi Jinping who has started to flirt with the Hitlerian ideas that drove Nazi Germany.

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Xi Jinping's conception of socialism | The Strategist - The Strategist

People wish to be settled, Ralph Waldo Emerson wrote. Only as far as they are unsettled is there any hope for them. This tension between stability and uprooting, between the illusory consolations of home and the risky lure of the open road, lies at the heart of Nomadland, Chlo Zhaos expansive and intimate third feature.

Based on Jessica Bruders lively, thoroughly reported book of the same name, Nomadland stars Frances McDormand as Fern, a fictional former resident of a formerly real place. The movie begins with the end of Empire, Nev., a company town that officially went out of existence in late 2010, after the local gypsum mine and the Sheetrock factory shut down. Fern, a widow, takes to the highway in a white van that she christens with the name Vanguard and customizes with a sleeping alcove, a cooking area and a storage space for the few keepsakes from her previous life. Fern and Vanguard join a rolling, dispersed tribe a subculture and a literal movement of itinerant Americans and their vehicles, an unsettled nation within the boundaries of the U.S.A.

Bruders book, unfolding in the wake of the Great Recession, emphasizes the economic upheaval and social dislocation that drive people like Fern middle-aged and older; middle-class, more or less out onto the road. Reeling from unemployment, broken marriages, lost pensions and collapsing home values, they work long hours in Amazon warehouses during the winter holidays and poorly paid stints at national parks in the summer months. They are footloose but also desperate, squeezed by rising inequality and a frayed safety net.

Zhao smooths away some of this social criticism, focusing on the practical particulars of vagabond life and the personal qualities resilience, solidarity, thrift of its adherents. Except for McDormand and a few others, nearly all of the people in Nomadland are playing versions of themselves, having made the slightly magical transition from nonfiction page to nondocumentary screen. They include Bob Wells, the magnificently bearded mentor to legions of van dwellers, who summons them to an annual conclave part cultural festival, part self-help seminar in Quartzsite, Ariz.; Swankie, an intrepid kayaker, problem solver and nature lover; and Linda May, a central figure in Bruders book who nearly steals the movie as Ferns best friend.

Friendship and solitude are the poles between which Zhaos film oscillates. It has a loose, episodic structure, and a mood of understated toughness that matches the ethos it explores. Zhao, who edited Nomadland in addition to writing and directing, sometimes lingers over majestic Western landscapes and sometimes cuts quickly from one detail to the next. As in The Rider, her 2018 film about a rodeo cowboy in South Dakota, shes attentive to the interplay between human emotion and geography, to the way space, light and wind reveal character.

She captures the busyness and the tedium of Ferns days long hours behind the wheel or at a job; disruptions caused by weather, interpersonal conflict or vehicle trouble without rushing or dragging. Nomadland is patient, compassionate and open, motivated by an impulse to wander and observe rather than to judge or explain.

Fern, we eventually discover, has a sister (Melissa Smith), who helps her out of a jam and praises her as the bravest and most honest member of their family. We believe those words because they also apply to McDormand, whose grit, empathy and discipline have never been so powerfully evident. I dont mean to suggest that this is an awards-soliciting display of acting technique, a movie stars bravura impersonation of an ordinary person. Quite the opposite. A lot of what McDormand does is listen, giving moral and emotional support to the nonprofessional actors as they tell their stories. Her skill and sensitivity help persuade you that what you are seeing isnt just realistic, but true.

Which brings me, somewhat reluctantly, to David Strathairn, who plays a fellow wanderer named Dave. Hes a soft-spoken, silver-haired fellow who catches Ferns eye and gently tries to win her affection. His attempts to be helpful are clumsy and not always well judged he offers her a bag of licorice sticks when what she wants is a pack of cigarettes and although Fern likes him pretty well, her feelings are decidedly mixed.

Mine too. Straitharn is a wonderful actor and an intriguing, nontoxic masculine presence, but the fact that you know that as soon as you see him is a bit of a problem. Our first glimpse of Dave, coming into focus behind a box of can openers at an impromptu swap meet, is close to a spoiler. The vast horizon of Ferns story suddenly threatens to contract into a plot. He promises or threatens that a familiar narrative will overtake both Fern and the movie.

To some degree, Nomadland wishes to be settled wants not necessarily to domesticate its heroine, but at least to bend her journey into a more-or-less predictable arc. At the same time, and in a fine Emersonian spirit, the movie rebels against its own conventional impulses, gravitating toward an idea of experience that is more complicated, more open-ended, more contradictory than what most American movies are willing to permit.

Zhaos vision of the West includes breathtaking rock formations, ancient forests and wide desert vistas and also iced-over parking lots, litter-strewn campsites and cavernous, soulless workplaces. Against the backdrop of the Badlands or an Amazon fulfillment center, an individual can shrink down to almost nothing. The nomad existence is at once an acknowledgment of human impermanence and a protest against it.

Fern and her friends are united as much by the experience of loss as by the spirit of adventure. So many of the stories they share are tinged with grief. Its hard to describe the mixture of sadness, wonder and gratitude that you feel in their company in Ferns company, and through her eyes and ears. Its like discovering a new country, one you may want to visit more than once.

NomadlandRated R. Living rough, and talking that way too. Running time: 1 hour 48 minutes. In theaters and on Hulu. Please consult the guidelines outlined by the Centers for Disease Control and Prevention before watching movies inside theaters.

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Nomadland Review: The Unsettled Americans - The New York Times