GF International Investment Management Ltd. chief executive Nathan Lin said his firm plans to launch two pure A-share funds in Hong Kong under the mutual recognition scheme despite a slump in the mainland stock market.
The wholly owned subsidiary of GF Fund Management Co. Ltd. wants them to be among the first batch of funds available to Hong Kong investors under the new channel, the Hong Kong Economic Journal reported Wednesday.
A-share funds could generate better returns than bond funds under the renminbi qualified foreign institutional investor (RQFII) scheme, Lin said.
The company has lined up roughly a dozen banks in Hong Kong to distribute the two pure A-share funds, which will not have a mandated investment scope.
This gives the fund managers flexibility to decide on what stocks to invest in; they will not be limited to a certain market capitalization or sector, Lin said.
He expects much less competition in the sale of such mutually recognized funds, as some fund firms are hesitant to launch them, compared with RQFII funds at their debut in Hong Kong three years ago.
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