HSBC Asset Management (HSBC AM) announced on Wednesday the launch of the HSBC Global Money Funds – Renminbi for Hong Kong investors.
It invests in a diverse set of renminbi (RMB)-denominated money market instruments from issuers including governments, quasi-governments, international organisations, financial institutions (including banks) and corporates.
The underlying securities are also from a mix of geographies, said the firm, aiming to capture opportunities in both the onshore and offshore RMB universe.
“In the last decade, RMB has come a long way as an international currency for trade, payments and finance. It is now the world’s third most used currency in trade finance and the fifth most active currency for global payments,” said Gordon Rodrigues, chief investment officer, liquidity, Asia Pacific, at HSBC AM, and also the manager of the fund.
“As offshore renminbi circulation continues to increase, there is a need for viable alternatives intended for institutions and individuals to manage their RMB liquidity,” he added.
The fund focuses on managing liquidity, interest rate and credit risks by investing in short-term RMB-denominated instruments.
As the Chinese central government is committed to strengthening Hong Kong’s role as a global offshore RMB business hub, HSBC AM believes RMB internationalisation will continue and that the fund can “potentially provide a relatively lower risk and highly diversified option for investors to manage their renminbi cash needs”.
HSBC AM has been managing money market funds for over three decades and it manages $136bn in money market assets across 10 currencies globally as at the end of March.