Launched in 2007, the East Capital (Lux) China Fund received approval in 2015 to invest up to 100% in A-shares via the Hong Kong-Shanghai Stock Connect. As of November, it had about 30% of the portfolio invested in China's financial sector.
The fund will be renamed the East Capital China Environmental Fund.
From 18 January, it will invest in both onshore and offshore China equities, in sectors such as clean energy, energy efficiency, clean transport, clean water and air, environmental assets and sustainable agriculture, the firm said.
“The fight against pollution is a fundamental and structural trend in China, and has also become a governmental priority,” said Karine Hirn, partner at East Capital.
“This implies strong policy support and large investments, as well as stricter implementation of regulations for the non-environmental friendly companies.
“China is the largest clean tech market in the world and the investment universe of environmental stocks consists of fast-growing innovative companies and often upcoming global leaders.”
Peter Elam Håkansson, chief investment officer and partner, manages the fund. He is supported by a Hong Kong team led by François Perrin.
Perrin recently joined the firm from BNP Paribas Investment Partners Asia, where he was head of Greater China.
Stockholm-based East Capital specialises in investing in emerging and frontier markets. It manages €2.1bn ($2.27bn) in public equity, private equity and real estate.