Pictet Asset Management has received a green light from the Securities and Futures Commission to offer the Pictet Asian Bond Income Fund to Hong Kong retail investors, according to the regulator’s website.
It will be Pictet AM’s second Hong Kong-domiciled fund, four years after the firm launched the Pictet Strategic Income Fund, a multi-asset product that has garnered assets of $143m, according to FE Fundinfo.
The Asian Bond Income Fund will invest across a “blend of Asian investment grade and high yield corporate bonds that targets income optimisation while avoiding concentrated credit risks,” a spokeswoman told FSA.
It will be benchmark agnostic and adopt a bottom-up credit analysis strategy that will be managed by Hong Kong-based Cary Yeung, Pictet AM’s head of Greater China debt, she said.
Several asset managers, such as Blackrock, have promoted their Asian fixed income funds in recent months, emphasizing the higher yields available compared with US and European bonds, as well as lower corporate default rates in the region.
However, the exact launch date of the Pictet product has not been confirmed and further details have yet to be ironed out, according to the spokeswoman.
Pictet AM had total AUM of $227bn (as at 31 December 2019), according to the firm’s website, and FE Fundinfo data shows that the firms offers a range of 24 funds to Hong Kog retail investors.
CHINA INITIATIVES
Last month, Pictet AM announced the opening of a wholly foreign-owned enterprise in Shanghai, which will be allowed to raise funds from domestic mainland investors to invest in the firm’s offshore strategies under the Qualified Domestic Limited Partners (QDLP) programme.
Pictet AM has been investing onshore for global clients through several schemes, such as the Renminbi Qualified Foreign Institutional Investor (RQFII) programme, Shanghai-Hong Kong Stock Connect, Bond Connect and China Interbank Bond Market (CIBM) Direct Access.
The firm has been cooperating with onshore global banks under the Qualified Domestic Institutional Investor scheme.
In July, Pictet AM offered its Strategic Income Fund as its first northbound product under the Mutual Recognition of Funds (MRF) scheme.
Asked whether the Pictet Asian Bond fund will eventually be offered to China onshore investors under the MRF scheme, the spokeswoman said that “any Hong Kong-domiciled fund will only be eligible for the MRF scheme one year after launch, and we do not rule out any possibility”.
