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General risks: The value of investments, and any income generated from them, can fall as well as rise. Where charges are taken from capital, this may constrain future growth. Past performance is not a reliable indicator of future results. If any currency differs from the investor's home currency, returns may increase or decrease as a result of currency fluctuations. Investment objectives and performance targets may not necessarily be achieved, losses may be made.
Latest Insights
Until recently China’s role in the global economy was confined to it being the world’s largest trading nation.
China is now stirring and expanding its role beyond trade to include finance and investment.
Equity Insights
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Corporate governance, advocacy and engagement in China: winds of change
March
US-China trade tensions in perspective
November
Fixed Income Insights
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China: shifting focus from financial to environmental health
February
Investec All China Equity
Investment objective:
The Strategy aims to provide long-term capital growth primarily through investment in equities or equity-related securities issued by Chinese companies listed anywhere in the world.
Greg Kuhnert
Portfolio Manager
Wenchang Ma
Assistant Portfolio Manager
Why invest in all-China equities?
- Chinese equities offer one of the highest revenue, earnings and cashflow growth opportunities globally
- Investing in both onshore and offshore Chinese equities doubles the investment universe and maximises the potential of finding interesting investment opportunities
- The All China market is a better representation of the Chinese economy, providing access to unappreciated quality blue chips in the industrial, consumer and healthcare sectors.
- Looking through shorter-term volatility, we believe the China A-share market offers attractive longer-term potential
Why 4Factor™ for Chinese equities?
- Specialist China team based in London and in Hong Kong
- Strong track record of picking stocks in China over the past decade
- We follow a strong, disciplined and tested investment philosophy
- We have grown our Chinese equities under management to US$6.8bn and managed total assets of US$59.0bn as at 31 December 2017
- Our global perspective enhances analysis of Chinese stocks
Strategy highlights
- Investment universe: Chinese companies listed anywhere in the world, inclusion of A shares doubles the universe size
- Minimum market cap: US$500m, daily liquidity US$2m, minimum coverage by two analysts
- Portfolio construction: maximum 60 stocks
- Performance target*: 3-5% per annum above MSCI All China Index
*Performance target may not necessarily be achieved, losses may be made.
The above guidelines are internal and subject to change without prior notice.
Investec All China Bond
Investment objective:
The Strategy aims to provide income with the opportunity for long-term capital growth primarily through investment in a portfolio of debt securities issued by Chinese borrowers both offshore and in mainland China.
Wilfred Wee
Portfolio Manager
Peter Eerdmans
Portfolio Manager
Why Investec Asset Management for Chinese fixed Income?
- A long history in emerging markets
- Tried and tested emerging market bond and currency processes
- Investec Asset Management has an established team of experienced professionals and investment process
Why invest in Chinese fixed income?
- Strategic opportunity to invest in China’s internationalisation story at attractive yields
- Allocating to Chinese fixed income can help diversify overall portfolio returns
- China’s credit markets are diverse and differentiated, and offer opportunities across the cycle
- The renminbi offers investment opportunity
- Gain exposure to the world’s largest developing bond market that is under-represented and set to increasingly feature in global fixed income allocations
- Manage US$3.3bn in Asian EMD assets within global EMD portfolios, as at December 2017
Strategy Highlights
- Can invest in offshore CNH bonds, onshore CNY bonds and USD-denominated bonds issued by Asian companies that are strongly linked to China's economy
- Broad investment mandate that allows for active management to unlock relative value opportunities across the onshore CNY, offshore CNH and US$ markets
- Strategy targets 1.5% per annum, gross of fees, over rolling three-year periods versus the Markit iBoxx Asia Local Bond Index China Offshore
Performance target will not necessarily be achieved, losses may be made.
Specific risks
All China Bond and All China Equity have the following risks:
Currency exchange: Changes in the relative values of different currencies may adversely affect the value of investments and any related income. Developing market: These markets carry a higher risk of financial loss than more developed markets as they may have less developed legal, political, economic or other systems. Geographic / Sector: Investments may be primarily concentrated in specific countries, geographical regions and/or industry sectors. This may mean that the resulting value may decrease whilst portfolios more broadly invested might grow. Investing in China: Investment in mainland China may involve a higher risk of financial loss when compared with countries generally regarded as being more developed.
All China Bond has the following risks:
Concentrated portfolio: The portfolio invests in a relatively small number of individual holdings. This may mean wider fluctuations in value than more broadly invested portfolios. Default: There is a risk that the issuers of fixed income investments (e.g. bonds) may not be able to meet interest payments nor repay the money they have borrowed. The worse the credit quality of the issuer, the greater the risk of default and therefore investment loss. Derivative counterparty: A counterparty to a derivative transaction may fail to meet its obligations thereby leading to financial loss. Derivatives: The use of derivatives may increase overall risk by magnifying the effect of both gains and losses. This may lead to large changes in value and potentially large financial loss. Interest rate: The value of fixed income investments (e.g. bonds) tends to decrease when interest rates and/or inflation rises. Government securities exposure: The portfolio may invest more than 35% of its assets in government securities issued or guaranteed by a permitted single state.
All China Equity has the following risks:
Derivatives: The use of derivatives is not intended to increase the overall level of risk. However, the use of derivatives may still lead to large changes in value and includes the potential for large financial loss. Equity investment: The value of equities (e.g. shares) and equity-related investments may vary according to company profits and future prospects as well as more general market factors. In the event of a company default (e.g. bankruptcy), the owners of their equity rank last in terms of any financial payment from that company.
Important information
All information is as at 31.03.18 unless otherwise stated.