BOC Hong Kong to launch mixed-asset fund amid bullish outlook on Chinese stocks and bonds

The asset management unit of Bank of China Hong Kong (BOCHK) said it will launch a China-themed mixed asset fund next week amid the bullish outlook for Chinese stocks and bonds.

The BOCHK All Weather China Income Fund will invest 70 per cent in Chinese equities listed on the mainland, Hong Kong and US markets, and 30 per cent in onshore and offshore bonds issued by Chinese companies, bank officials said on Thursday.

“We are bullish on stocks and bonds with the China concept, both onshore and offshore,” said Shen Hua, chief executive officer of BOCHK Asset Management, which has US$10 billion in assets under management.

The new fund will be the first from the bank to trade through Bond Connect, a mechanism set up in July to allow foreign investors to trade China’s interbank bond market via Hong Kong Exchanges and Clearing.

The Chinese economy is likely on an upward cycle now, with supply-side reform leading to improved Producer Price Index (PPI) and commodity prices, Shen said.

It is rare that both the Chinese equity and fixed income markets have been doing well since the beginning of this year, he added.