British asset manager Schroders has launched the Schroder ISF China A-Share, currently invested in onshore China A-shares through the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect.
China A-shares represent a universe of over 3,500 stocks with low correlation to other equity markets.
The Schroders’ Asian Equities team, with Jack Lee, lead investment manager and head of China A-Share Research, will manage the fund and focus on small to mid cap stocks with a quality bias and apply an active, bottom-up approach to explore best opportunities.
The fund’s inception dates back to 6 December 2017.
Jack Lee said: “In my 19 years of investing in China, the opening of the ‘Stock Connect’ is providing one of the best opportunities for investment in what is an often a misunderstood market.
“Through our investment lens, we are able to identify exciting opportunities in the dynamic mid to small cap space, particularly within the fast-growing sectors such as technology, healthcare and the consumption space.
“It is in the mid to mid cap space that the onshore China market features many compelling companies that demonstrate a combination of strong management and product/service leadership in the fastest growing (soon to be the largest) internal marketplace in the world.”
John Troiano, global head of Distribution at Schroders said: “Schroders has moved quickly to act on the huge opportunity that the opening of the China A-share market has presented for our international clients.
“We believe that this active, bottom-up approach will provide investors a strong source of growth, through one of the fastest growing markets in the world; and portfolio diversification, through an equity market that is largely underrepresented in global portfolios and has low correlation to other markets.”
In its May 2018 edition, InvestmentEurope explored the China A-Shares theme from the perspective of fund managers and selectors.