PRESS RELEASE: HSBC Global Asset Management this week launches the HSBC GIF RMB Fixed Income fund. The fund enables UK and European investors to gain access to Renminbi investments.
Forming part of HSBC Global Asset Management’s Luxembourg-based Global Investment Funds (GIF) SICAV, the new fund will be registered for sale across Europe.
The fund is managed by HSBC Global Asset Management’s Asian fixed income team, based in Hong Kong and headed by Cecilia Chan who has managed Asian fixed income assets at HSBC for 17 years. This award-winning team manages a total of US$24bn in Asian fixed income (as at end June 2011).
Chan said: “The investment case for the Renminbi is powerful given the potential currency appreciation. The Chinese authorities have allowed a managed appreciation of the currency to cool the economy and to ease international relations with trading partners who objected to the advantageous terms of trade that a weak Renminbi has meant for China. This process still has further to go and the Renminbi has the potential to be one of the world’s major reserve currencies in the future. As such, we believe the emergence of the offshore Renminbi fixed income market will provide investors with an exciting new investment opportunity.”
HSBC GIF RMB Fixed Income will focus on offshore RMB denominated instruments including RMB denominated bonds and RMB deposits. The fund is structured so that asset allocation will vary over time as opportunities develop in the market and as the regulatory environment evolves.
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The RMB market is characterised by shorter duration instruments and so the average duration of the fund is likely to be in the 1-3 year range. There will be diversified credit exposure, and the investment approach will combine a rigorous top down approach with bottom up fundamental analysis. Many RMB issues are non- rated so all issues will be subject to a rigorous screening process by the investment team.
Andy Clark, Head of Wholesale, EMEA at HSBC Global Asset Management, said: “The HSBC GIF RMB Fixed Income fund is an early entrant within the Ucits structure. The fund brings the expertise of HSBC’s vast capability in Asian fixed income to European investors in a straightforward format.”
In February 2011, HSBC Global Asset Management launched the HGIT RMB Bond fund, based in Cayman targeting mostly Asian clients. Share classes are available for wholesale and institutional clients, with minimum investment levels of US$5,000 and US$1m respectively.
HSBC Global Asset Management is a leader in emerging markets, with US$139bn invested in this asset class (as at end June 2011).