(China Alert) Fidelity expands in China: The new normal

  • WFOE
·Fidelity has applied for a new WFOE ·The directionality of China access and onshore business is clear ·WFOE strategy is becoming ever more critical Update: Last Thursday, Fidelity announced that it has been approved to establish a WFOE on the Mainland (widely expected and discussed to be an investment management WFOE). This would be the […]
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(China Alert) Chinese hedge funds: Back to the future

  • Hedge funds, PFM
·PFMs are the fastest growing AM segment in China ·This growth is continuing despite volatility ·The PFM structure is being used by global managers for China access Update: Private securities fund managers (PFMs), or China’s equivalent to western hedge funds, is the fastest growing asset management segment on the Mainland. However, it gets very little […]
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(China Alert) MRF update: Traveling and moving

  • MRF
·Four new MRF funds have been lodged with CSRC ·Domestic agent selection is splitting into distinct tiers ·Re-domiciling and foreign ownership will define MRF Update: Four new MRF funds have been lodged with CSRC. CCB International and Value Partners are new names on the list. The update is not particularly surprising in terms of firm […]
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(China Alert) RMB Internalization: SDR inclusion is just the start

  • rmb
·We believe the outlook for the RMB’s inclusion into the IMF’s SDR basket is looking positive ·The RMB as a currency is becoming normalized ·RMB supply and demand remain at odds with each other Update: RMB internationalization is the foundation of the opening of China’s capital account. The currency’s imminent inclusion into the IMF’s Special […]
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(China Alert) QDII and MRF: Out with old, in with the new

  • FMC, JV, MRF, QDII
·Two joint venture FMCs killed off QDII funds last week. ·They died for reasons that have little to do with QDII’s overall health. ·The liquidations reinforce how MRF timing and fund choice will be critical at this juncture. Update: Two JV FMCs – Manulife Teda and Fortune SG – each liquidated a QDII fund last week, an industry first. Z-Ben […]
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(China Alert) WFOE structure: the need to look forward

  • Asset Management Platform, Fund Manager, JV, WFOE
·UBP has restructured its JV asset management platform ·This is a stark contrast to Aberdeen’s innovative WFOE ·Ownership structure will dictate future direction and opportunities Update: In the same month that Aberdeen AM has announced its innovative WFOE, Union Bancaire Privée (UBP) has altered the ownership structure of its existing JV management platform. This presents […]
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(China Alert) London: the next Hong Kong

  • EFD, Stock Connect
·Feasibility study to be conducted for London-Shanghai Stock Connect ·Aberdeen AM and GF International are applying for business licenses ·London’s willingness to work with China makes further progress likely Update: The UK and China announced the press release of agreements from the Economic and Financial Dialogue (EFD) on Monday evening. The new deal shows clear evidence […]
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(China Alert) Global Managers: Gaining real control

  • Stock Connect, WFOE
·Hang Seng will take a 70% stake in a domestic JV FMC ·Aberdeen announces unique WFOE ahead of UK talks ·Regulators are permitting foreign firms to claim more territory Update: The route to ownership for a company able to manage and market investment products in China is becoming shorter and straighter. This transformation is occurring at […]
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(China Alert) Cross-border: Mega R/QFII quotas expected

  • QFII, RQFII
·More firms are being granted larger R/QFII quotas and IBB licenses ·Top-line cross-border access will increase and quota will be notional ·Global managers will have more freedom and optionality Update:  Z-Ben Advisors has observed that firm-level access to the China market is being granted in a greater magnitude. We believe this shows that regulators are focusing […]
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(China Alert) CSRC to impose new A-share circuit breaker

  • cross border, CSRC, QFII, RQFII
·CSRC issued a draft proposing daily suspension limits for CSI 300 ·30 min suspension for a 5% up or down move, full-day closure for 7% ·This would have far-reaching impacts on the cross-border landscape Update:  CSRC issued draft regulations last night stipulating new daily suspension and closure limits for the A-share market. If the CSI 300 […]
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