CIMB first to have direct access to China A-Shares
New fund enables investors to tap into China’s new economy
KUALA LUMPUR: CIMB-Principal Asset Management Bhd (CIMB-Principal) has launched its maiden China-focused fund, CIMB-Principal China Direct Opportunities Fund under its Renminbi Qualified Foreign Institutional Investor (RQFII) licence.
CIMB-Principal is the first entity in Malaysia to be awarded this licence which allows it to invest directly in the China A-Shares market.
The fund is an equity growth fund that aims to provide capital appreciation over the medium to long-term and will invest a minimum of 70 per cent of its net asset value (NAV) in China A-Shares focusing mainly on small and midcap companies with good growth potential, while the remaining 30 per cent of its NAV will be invested in liquid assets.
The fund is co-managed by CCB Principal Asset Management Co Ltd (CCB Principal), one of China’s fastest growing asset management companies – backed by China Construction Bank, USbased Principal Financial Group, and China Huadian Capital Holdings Company Ltd – with US$207 billion of assets under management as at December 2017.
CIMB-Principal chief executive officer Munirah Khairuddin said, “We are excited to offer this fund, the first under our RQFII licence.
“There is no better time to participate in China’s new economy – comprising industries such as information technology, green technology, healthcare and consumer discretionary, which are set to propel China’s next growth trajectory.
“Through this fund, Malaysian investors will have direct access to a hitherto untapped universe of opportunities, previously accessible to only Chinese citizens. Access to the China A-share market also supports CIMB-Principal’s growth and diversification strategy, which enhances our overall investment advisory capabilities.”
Munirah added, “We are optimistic of the demand from Malaysian investors, and are confident of achieving our target fund size of US$100 million within the first year of the Fund’s inception.
We are excited to offer this fund, the first under our RQFII licence. There is no better time to participate in China’s new economy – comprising industries such as information technology, green technology, healthcare and consumer discretionary, which are set to propel China’s next growth trajectory.
“We truly believe that CCB Principal’s on-the-ground expertise in China, its solid track record in managing regional and global investments and CIMB Principal’s investment capabilities will form a strong synergy to ensure the optimum performance of not only this fund, but also future China-focused funds by CIMB-Principal.”
With direct access to the China A-Shares market, subscribers to the fund have the opportunity to invest in the world’s second largest equity market, a direct proxy to an economy set to grow at 6.6 per cent in 2018.
China A-Shares are traded on the Shanghai and Shenzhen Stock Exchanges, with trades denominated in renmimbi.
The inclusion of China A-Shares in the MSCI Emerging Markets Index in 2018 is also expected to attract more inflows into China’s equities market.
China A-Shares make up the largest equity market in Asia, and is second only to the New York Stock Exchange in the world.
The benchmark for the Fund is Shanghai Shenzhen CSI 500 Index which encompasses some of the fastest growing small and medium companies with the potential to be global players.
CIMB Bank Regional head of Wealth Management Gary Yong said, “The fund is a strong addition to CIMB Bank’s suite of investment products, enabling us to cater to an even wider range of investor profiles.
“Asia’s future growth will continue to be underpinned by China, and her economy’s rapid but calculated embrace of new technology. There is no better time to be part of that growth story than now, when we are at the cusp of the Fourth Industrial Revolution.”
The fund offers units in three currency classes: ringgit, Singapore dollar and US dollar.
Investors who are keen to know more about CIMB-Principal China Direct Opportunities Fund can visit www.cimb-principal.com.my or the nearest CIMB Bank branch.
Munirah Khairuddin, CIMB-Principal chief executive officer