CSOP Asset Management, one of China’s biggest offshore asset managers, has set up a Singapore office as a subsidiary of its Hong Kong business, according to statement on Wednesday.
Singapore was a “natural choice” for the firm, because of its financial infrastructure, transparent regulatory environment, appealing tax regime and its access to a wealthy investor base.
Initially, CSOP AM intends to develop a family office and external asset management business and offer products, suitable for high net-worth individuals in Southeast Asia, the statement said.
The firm hopes to provide opportunities in China’s gradually opening capital markets, and extend the franchise it has built up in Hong Kong over the past decade. Currently it has 18 funds authorised by the Hong Kong’s Securities and Futures Commission (SFC), of which 14 are exchange traded funds, including five leveraged or inverse products, according to FE Analytics data.
In May, the firm launched Hong Kong’s first inverse product that has a -2x multiplier, the CSOP Hang Seng Index Daily (-2x) Inverse Product, after the SFC relaxed rules on inverse products earlier this year.
More recently, the firm recalibrated its Hang Seng China Enterprise Index Daily (-1x) Inverse Product to have a -2x multiplier.
A local presence in Singapore enables the firm to gain in-depth knowledge about the local wealth and asset markets, and helps it present its China investment intelligence and access, according to Ding Chen, CSOP AM’s chief executive officer in the statement.
The firm also has plans to create a local portfolio management team in Singapore, examine the potential of collaborating with other asset managers and sovereign wealth funds on institutional mandates, and even explore shariah-compliant services — presumably with an eye on the Malaysia and Indonesia markets.
In 2008, CSOP AM became the first offshore entity set up by a regulated Chinese asset manager with Hong Kong SFC type 1 (dealing in securities), type 4 (advising on securities) and type 9 (asset management) licenses.
It manages the biggest renminbi equity and fixed income ETF listed in offshore China, and is the firm is the largest renminbi qualified foreign institutional investor (RQFII) asset manager globally. As of 30 June 2018, CSOP AM had $4.5 billion in assets under management, according to its website.