China has the world’s second largest equity market and the third largest bond market*. As China takes increasing steps towards Renminbi (“RMB”) internationalization with many new cross-border measures, these markets represent an unmissable opportunity for investors.
In 2008, CSOP Asset Management Limited (“CSOP”) became the first offshore entity to be set up by a regulated Chinese asset manager, and has since remained at the forefront of China’s capital market liberalization.
While we share the excitement about the opportunities that China’s capital market presents, we are also aware of the concerns and challenges that international investors may have:
* Source: Bloomberg, as of 30 January, 2015.
How do I get access?
As the largest Renminbi Qualified Foreign Institutional Investor (“RQFII”) in the world, CSOP has substantial experience helping clients access the China onshore market:
Leadership in QFII/RQFII^
CSOP is both an RQFII and a Qualified Foreign Institutional Investor (”QFII”), with a total RQFII quota of more than USD 7.5 billion. On a firm level, CSOP is the largest RQFII manager in the world (see charts below).
Comprehensive ETF platform
CSOP manages the largest RQFII Exchange-Traded Funds (”ETFs”)** in both equity and fixed income categories, providing direct and transparent access to China markets. CSOP also has ETF products listed in Europe, with additional new products to be offered around the globe. CSOP is committed to providing a round-the-clock trading platform for China’s equity and fixed income markets.
CSOP is a solutions provider, not a quota provider. We offer China investment solutions to investors in many formats, including Hong Kong public funds, UCITS structures, Cayman vehicles and segregated accounts; the investment scopes of these structures span across equities, inter-bank fixed income, and futures markets; we even work with partners to help clients set up their own structures to fully access the China market. Dedicated to innovation and leading the industry, CSOP is also one of the first asset managers to participate in the Shanghai-Hong Kong Stock Connect.
^ Currently, the China capital market offers limited access to foreign investors. Under current regulations in China, foreign investors can invest only in the domestic securities market through certain foreign institutional investors that have obtained QFII or a RQFII status from the China Securities Regulatory Commission and have been granted a quota by The State Administration of Foreign Exchange to remit foreign freely convertible currencies (in the case of a QFII) and RMB (in the case of an RQFII) into China for the purpose of investing in the China’s domestic securities markets.
** The ETFs are all listed and authorized in Hong Kong. Source: Bloomberg, as of 30 January 2015.
How can I best utilize my access?
With a professional team of over 50 based in Hong Kong, we can help investors to get access to China Markets:
A tale of two markets
From its Hong Kong base, CSOP has a unique perspective on opportunities in both Hong Kong and China. Our Hong Kong equity and fixed income RQFII strategy best utilizes onshore-offshore pricing differences to present the potential of investing in China. By looking at China from the outside and the rest of the world from the point of view of China, we are constantly finding exceptional “new balance” opportunities.
Finding the right talent
CSOP fully understands that different people have different skills. To provide the “best in class” for China, we work hard to connect onshore talents to the international investor community. Our ‘manager of managers’ strategy offers access to the some of the best private managers onshore and we are always striving to add expertise to our unique platform.
Am I exposed to more risks?
As expectations of returns increase, it’s also important to mitigate risk, especially in markets to which investors have had little or no access until recently. CSOP not only seeks to alleviate investor concerns by sharing market knowledge, we also develop rules and tools to help analyze and illustrate the risks for our investors.
A dedicated risk team
All business activities, including but not limited to investments, operations, legal, compliance, and marketing, are under the formal control of our risk management committee, which is chaired by the CEO of CSOP. Dedicated risk management functions are responsible for monitoring the portfolios managed or advised by CSOP in a timely manner, and resolving, reporting and addressing any risk to which our investors may be exposed.
Where do I start?
A China expert is only a phone call away (844-209-2937) to answer your questions.
We believe in partnerships
CSOP works closely with many investment banks, custodian banks, security houses and marketing intermediaries to provide comprehensive solutions to our clients. We believe the China story should be written by us together.
We bring people together
We understand that the China market is so big that we simply can’t do everything ourselves. Thus, we are happy to introduce our partners to you if it’s a good fit. We see our role not just as an asset manager but as a team who can connect you with unique insights into China through our great network.