Posted inChina

William O’Neil rolls out first onshore fund in China

The firm will be competing against several foreign quant managers that have entered China's private market. It also intends to apply for a QDLP licence.

Los Angeles-headquartered William O’Neil’s wholly foreign-owned enterprise (WFOE) in Shanghai has received regulatory approval to launch its first private fund management (PFM) product, the William O’Neil Fengwen Growth Private Securities Investment Fund, according to records from the Asset Management Association of China (AMAC).

The move comes after the firm obtained a PFM license in April last year, which enables foreign entities to develop and sell funds investing in onshore assets to domestic qualified investors, which include institutional and high net worth investors.

Local media publication China Fund News last year reported that the firm intends to launch quantitative products in China.

The report also noted that in November 2019, Steven Birch, the firm’s president, spoke at an event organised by Oriental Securities and indicated that the firm is exploring ways of developing quantitative funds in China by incorporating its experience in the US.

On top of its PFM business, the firm is also planning to apply for a qualified domestic limited partnership (QDLP) licence this year, according to a spokesperson of the firm.

Launched in 2013, the QDLP scheme allows licensed foreign asset managers to raise renminbi-denominated sums from qualified individual and institutions in China, with assigned quotas, to invest in offshore traditional and alternative investments. 

When launched, William O’Neil will be competing against a number of foreign managers that have started to offer quant PFM strategies in China. UK-based Winton Capital, for example, now has 10 PFM funds. Other quant managers that have entered China’s private market include Bridgewater AssociatesParis-based Metori Capital ManagementUS-based Two SigmaDE Shaw and Man Investments.

William O’Neil & Co is an independent advisory firm that provides buy and sell recommendations and independent research to institutions, according to the firm’s website. It makes use of the “O’Neil methodology” (OM), founded by William O’Neil in the 1960s, which combines fundamental, quantitative and technical analysis to identify stocks that are poised to outperform.

According to the firm’s website, it already has a China A-shares focus list, which is a curated list of stocks chosen by its analyst team using the OM.

Besides its WFOE, the firm has another affiliate in Shanghai, a research and information technology company that develops investment research terminals and mobile apps for Chinese equity investors, according to the firm’s website.

Part of the Mark Allen Group.