Morgan Stanley Investment Management (MSIM) has launched its Morgan Stanley Investment Funds’ (MS INVF) China A-shares fund in a Luxembourg Sicav format.
The strategy was hitherto only distributed to institutional investors in a separate account format.
The fund aims to exploit pricing anomalies and inefficiencies in the A-shares market via the construction of a high-conviction portfolio of high-quality companies in industries the management team believes could grow faster than overall GDP growth; have the potential to gain market share; and could be able to maintain or expand their profit margin.
The portfolio will hold 25 to 40 active positions.
Hong Kong-based lead portfolio manager, Gary Cheung, commented: “We believe China’s economy will shift from being driven by investments and exports, to one that is driven more by consumption and services. In our opinion, exposure to A-shares will be vital for investors to participate in this growth.”
“The China A-shares Fund is another example of how MSIM adds value to clients through active management. Across the platform, our equity portfolios are run by long-tenured portfolio managers with consistent philosophies that deliver low turnover and concentrated products. We’re delighted to be able to offer our China A capabilities to a broader client base via the Sicav structure,” said Paul Price, MSIM’s global head of Sales.
The team manages $1.1bn (€911.7m) in dedicated China A Share assets, across separate account portfolios and a closed-end US mutual fund.
Morgan Stanley Investment Management had $447bn (€370.5bn) in assets under management or supervision as of 30 September 2017.