Hong Kong asset manager targets A shares
Value Partners to use RQFII yuan quota to invest in mainland market, in an attempt to use its stock-picking expertise to deliver results
Fund manager Value Partners plans to launch a pure equity fund to invest offshore yuan in the mainland’s A-share market next quarter, as part of its response to Beijing’s efforts to globalise its currency.
The Hong Kong-based asset manager, set up by Cheah Cheng Hye, plans to use an 800 million yuan quota allocated under the RQFII (renminbi qualified foreign institutional investors) scheme to invest in the mainland stock market.
Unlike its peers, who mostly chose to launch fixed-income- or exchange-traded funds with their RQFII quotas, Value Partners believes its value-based stock picking expertise, in a market that many foreign investors find to be opaque, will deliver good results.
“The basic nature of the fund will be ‘benchmark agnostic’ and will rather include active stock picking and bottom-up research,” Timothy Tse, chief executive, said.
“Many investors may have a neutral view on the China economy, but the asset pool available in Europe and the United States is so large that they only need to allocate a small amount of money to RQFII funds and there will be huge demand,” Tse said.
Apart from the new fund, the Hong Kong-based manager is planning a number of other initiatives to capitalise on the rising opportunities of a more open mainland Chinese financial market.