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China AMC plans mixed-asset launch in Hong Kong

The firm’s global balanced fund will be sub-advised by Toronto-based Mackenzie Investments. Separately, Tencent’s joint venture is also expected to launch its fixed income fund.

China Asset Management Company in Hong Kong this month received approval from the Securities and Futures Commission to launch the China AMC Mackenzie Global Strategic Income Fund, according to records from the regulator.

The fund is the firm’s first global balanced fund, according to a Hong Kong-based spokeswoman at the firm. It is also the firm’s first fund that will be sub-advised by Canadian firm Mackenzie Investments, she added.

Mackenzie Investments has a 13.9% stake in Beijing-based China AMC. It first acquired a 10% interest in December 2016 and bought another 3.9% in January 2017, according to a statement from the Canadian firm.

The partnership between the two firms allows Mackenzie to leverage on China AMC’s investment capabilities and vice-versa. In October last year, Mackenzie launched its All China Equity Fund for Canadian investors. It is sub-advised by China AMC in Hong Kong, according to a separate statement.

Product expansion

The Hong Kong-based firm’s global balanced fund will be its second mutual fund that invests in global markets.

In late August, it launched the Select Fixed Income Allocation Fund, a Hong Kong-domiciled fund that invests in government and corporate bonds globally, according to the spokeswoman.

The firm said the fixed income product, which it views as a liquidity management product, is in response to the growing demand for safehaven investments amid rising volatility in the equity and bond markets. According to the spokeswoman, the product has short duration and invests in securities the manager deems to be safe.

The firm manages seven other SFC-authorised funds, with the majority investing in Chinese securities, including one Asia-focused fixed income fund, according to SFC data.

It also manages five Hong Kong-listed ETFs, with four of them focusing on the Chinese equity market, according to data from the local bourse.

Tencent’s joint venture

Separately, Gao Teng Global Asset Management received approval from the Hong Kong regulator to launch the Gao Teng Asian Income Fund, according to SFC records.

Gao Teng is Tencent’s fund management joint venture firm in Hong Kong with Beijing-based Hillhouse Capital Group. Tencent has a 49% stake in the joint venture and Hillhouse owns the remainder.

The Asian Income Fund, which is Gao Teng’s first SFC-authorised fund, will invest in Asia-Pacific corporate and government bonds, according to its key product statement.

FSA sought more information from Tencent, but the company was unable to comment in time for publication.

Part of the Mark Allen Group.