DE Shaw’s private fund management (PFM) wholly foreign-owned enterprise (WFOE) in Shanghai has received approval on Wednesday to launch its DE Shaw Razor China Private Securities Investment Fund (德劭锐哲中国私募证券投资基金 in Chinese), according to records from the Asset Management Association of China (Amac).
FSA sought more information from the firm, but it was not able to provide more details, such as whether the product is an equity, bond or mixed-asset product, in time for publication.
This will be the first onshore product that the firm will be launching in the mainland, after its WFOE received a PFM licence in April this year. A PFM licence allows foreign asset managers to launch onshore domestic funds to China’s qualified investors, which include institutions and high net worth individuals.
The US firm, which specialises in quantitative strategies, manages around $50bn in assets globally. The firm will also be using quantitative models for its onshore funds and will be managed by a Shanghai-based investment team, a New York-based spokeswoman for the firm said previously.
The firm’s WFOE has five Shanghai-based staff, with a registered capital of $4.1m, according to data from Z-Ben Advisors.
DE Shaw has been in Hong Kong since 2007 and has licences for asset management and dealing in securities, according to records from the Securities and Futures Commission (SFC). The firm does not have any SFC-authorised funds for retail sale.
Quant competition
DE Shaw joins the likes of other foreign PFMs that have launched quant funds in China.
Leading the pack is UK-based Winton Capital, which has rolled out six quantitative strategies. The firm is also one of the foreign PFMs that have launched the most number of funds, with Value Partners having the most with seven products. Winton, which positions itself as a systematic and data-driven investment firm, established its WFOE in Shanghai in 2012. The firm launched its first onshore product in July last year.
Another quant player in China is Man Investments, which launched one CTA fund and an equity quantitative product, according to Amac records.
In total, there are around 21 foreign PFMs, which collectively have launched 46 products with Rmb5.4bn ($756m) in assets as of August, according to a previous Amac statement.
