A small number of Chinese fund management houses are bringing their mainland research expertise to global clients and taking the first step in a broader international expansion plan by opening Hong Kong subsidiaries.
Six firms have received approval from Hong Kong regulators in the past 18 months and more are expected to join them soon. The mainland firms have considerable work to do before they pose a serious competitive threat to the established international players, but they are in a better position to compete with European or US fund houses on selling Chinese investment advice to foreign investors.
“Our internationalisation could have started anywhere, but Hong Kong is closer to mainland and really part of China, so it's a natural choice,” says Michele Bang, chief executive of Harvest Global Investments. “The core of our strategy is to be a well performing fund for China equities and the Asian asset class.”