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Boutique mainland firm targets global investors

Hong Kong-based OPIM partners with emerging fund managers to help them tap global investors.
High-rise buildings and viaducts in the financial district of the city, night view of Beijing, China.

Hongcheng Capital in China has partnered with Hong Kong-based fund platform OP Investment Management (OPIM) to launch its first offshore fund, HC Capital, according to a joint statement from both firms.

Managed by Zhang Tao, Hongcheng’s founder and investment director, the fund is a long-biased strategy that invests in China equities listed in the mainland, Hong Kong, as well as ADRs in the US, according to the statement.

The fund is domiciled in the Cayman Islands and is available to professional investors only, which include institutions and high net worth individuals.

The fund’s investment process is based on a “sector-level strategy and the incorporation of various sub-strategies, such as growth strategy, value strategy, thematic investing and cyclical investing”, according to OPIM’s website.

“Quality China companies demonstrated their profit potential and ability in creating shareholder value amid economic restructuring,” Zhang said in the statement.

Hongcheng was established in 2015 and manages RMB 8bn ($1.4bn) in onshore assets, according to the statement. Before Zhang founded the firm, he was managing director and portfolio manager at Harvest Fund Management, which is China’s sixth-largest fund manager with an AUM of RMB 604bn, according to data from Morningstar Direct.

OPIM partnerships

OPIM partners with emerging managers to develop fund products domiciled offshore, such as Cayman or Ucits funds, for institutional and professional investors globally.

For example, last year, it partnered with China’s Qijan Global Investment Management to launch an offshore China A-share absolute return fund. The fund is available to private banking channels that serve high net worth investors and family offices.

OPIM has at least 18 strategies on its platform, which include global, regional and single country long-only, long-short, global macro, multi-asset and quant funds, according to its website. Around seven of those strategies are China-related products.

Separately, industry players have observed the influx of Chinese subsidiaries in Hong Kong with the goal of expanding overseas. For example, there has been an increasing trend of Chinese asset managers launching Ucits or alternative investment funds for offshore investors and they typically do it through their Hong Kong office, Alessandro Silvestro, Hong Kong-based managing director for Asia-Pacific at Lemanik Asset Management, said previously.

Lemanik AM is a management company that provides regulatory, supervision and oversight framework to support the fund’s operations and distribution in Europe. In December, for example, it partnered with E Fund Management in Hong Kong to launch a Ucits fund.

Part of the Mark Allen Group.