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AXA IM granted QFII licence

Added 28th January 2015

AXA Investment Mangers has been granted a Qualified Foreign Institutional Investor (QFII) licence to invest into the China A-shares market.

AXA IM granted QFII licence

The company has been allocated a quota under the QFII scheme through a joint venture with Shanghai Pudong Development Bank (SPDB).

In conjunction with SPDB it has created the AXA SPDB Chinese Equity A-Shares strategy to invest in small and mid-cap companies on the China A-Share market, in order to achieve long-term growth.

AXA also said it has launched a Luxembourg-registered alternative fund which is pending registration in further jurisdictions and will utilise the strategy.

Its stock selection process seeks to identify around 200 of the most attractive stocks within its investment universe, the CSI RAFI 400.

The strategy will be rebalanced monthly and is expected to have a low turnover.

It also has a dedicated equity team of eight portfolio managers, supported by nine research analysts.

Wendy Luo, portfolio manager at AXA SPDB Investment Managers, said the strategy is biased toward the industrial, service, IT, healthcare, and consumption sectors, rather than financials and energy.

“In such a liquidity-driven market as China, we believe growth companies at a reasonable valuation should be our focus,” she added.

“These companies are, in our view, in the sweet spot to benefit from the transition to a ‘new normal’ economy which China strives to achieve through structural and market reforms.”

Andrea Rossi, chief executive said: “China is too big to be ignored, yet at the same time there are very limited opportunities for foreign investors to access the market in an active way.

He said the company believes that China’s growth will benefit its equity market, which is currently trading at a discount from its peak in 2007.

“In this context, the liberalization of capital and financial markets is providing global investors with the means to access this market,” he added.

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