The two dozen China-domiciled funds available for sale in the SAR (southbound) under the Mutual Recognition of Funds (MRF) programme saw net inflows of around RMB 61.5m ($9.22m) in July – the highest monthly net inflows since the programme launched at the end of 2015, according to the latest data from the State Administration of Foreign Exchange (SAFE).
MRF monthly net sales (RMB m)
|
|
Northbound |
Southbound |
|
July |
313.71 |
61.5 |
|
June |
928.7 |
17.7 |
|
May |
1,140.80 |
42.6 |
|
April |
67.4 |
8.8 |
|
March |
-10.2 |
4.7 |
|
February |
-181.6 |
3.6 |
|
January |
-286.1 |
-2.4 |
|
Total net sales since January 2016 |
9,745.22 ($1.46bn) |
232.66 ($34.89m) |
Source: State Administration of Foreign Exchange
In terms of gross sales, China-domiciled funds in July were up to RMB 89.24m (239%) compared to June. Gross outflows, however, were also up 222% to RMB 27.75, the highest since January 2016.
“We have observed a stabilising RMB and the negative sentiment around Chinese equities has somewhat abated in recent times,” Wing Chan, Hong Kong-based director of manager research for Asia at Morningstar, told FSA. However, investors outside the mainland generally continue to be cautious toward Hong Kong and China equities, he noted.
“It remains a long road ahead for southbound funds,” he said.
Looking at northbound (Hong Kong-domiciled funds available for sale in the mainland) data from SAFE, the net monthly sales for these funds have dropped for the third straight month.
Since the beginning of 2016, only nine Hong Kong-domiciled funds have been approved for sale to mainland investors by the China Securities Regulatory Commission. Most recently, products from Schroders and Amundi have received approval.
