Tap into the growth and diversification potential of Chinese equities.
THE OPPORTUNITY SET
Chinese equities are among the world’s largest markets, comprising both onshore and offshore companies. They represent over USD 10 trillion in market capitalisation and look set to benefit from key structural trends such as China’s transition to a service- and consumption-led economy. What’s more, they still look attractively priced relative to developed markets.
The complimentary nature of Chinese equity markets can also offer an exciting opportunity and diversification. Offshore companies are oriented towards the financial and energy sectors (the “old economy”), while onshore Chinese companies are focused on consumption-driven industries like consumer goods, technology, new materials and healthcare (the “new economy”). China’s offshore equity markets are therefore largely made up of large caps and onshore of small caps, deriving most of their revenues from domestic operations.
BNP Paribas China Equity aims to increase the value of its assets over the medium term by investing primarily in Chinese (including Hong Kong and Taiwan) equities. Access is available to the “all-china” universe comprising onshore (China A-shares) and offshore (Hong Kong, Taiwan, US American Depository Receipts) companies.
We focus on three key structural themes:
- Technology and innovation
- Consumption upgrading
- Industry consolidation
Within each of these themes, we identify companies based on factors like industry and company dynamics, balance sheet strength, environmental, social and governance (ESG) assessment and valuations. This enables us to build a portfolio that targets quality stocks with high growth potential, strong management and cash flow predictability.
The fund is currently rated four stars by Morningstar*.
David Choa heads our Chinese equities team. David has more than 15 years of financial experience – from consulting, to corporate finance and equity investing, with a focus on China and Asia Pacific. He is supported by a team of portfolio managers and analysts from our offices in Hong Kong and Shanghai; a local presence is key to investing in China, we believe.
The team also has access to a senior economist dedicated to China, our Quantitative Research Group and our Sustainability Centre including four ESG experts based in Hong Kong.
Today, we manage over USD 1 billion in China-focused strategies.
Chinese equities – ahead of the curve
|Year to date, Chinese equities have been one of the best performing markets globally. Is such performance sustainable?|
Source: BNPP AM, as of March 2020. * Attributed to the Classic, Capitalisation share class as at 30.04.2020 by Morningstar. This advertisement has not been reviewed by the Monetary Authority of Singapore. It is issued and has been prepared by BNP PARIBAS ASSET MANAGEMENT Singapore Limited [BNPP AMS]. It is produced for information purposes only and does not constitute: 1. an offer to buy nor a solicitation to sell, nor shall it form the basis of or be relied upon in connection with any contract or commitment whatsoever or 2. investment advice. It does not have any regard to the specific investment objectives, financial situation or particular needs of any person. Investors should consult their own professional advisors in respect of legal, accounting, domicile and tax advice prior to investing in the fund(s), and in the event that he chooses not to seek advice from professional advisors, he should make an independent determination of the suitability and consequences of an investment. Investors considering subscribing to the fund(s) should read carefully the most recent prospectus, offering document including the risk factors and consult the fund(s’) most recent financial reports before investing, as available from BNPP AMS or its authorised distributors. Investments involve risks. Investments in emerging markets involve above-average risk. Given the economic and market risks, there can be no assurance that the fund(s) will achieve its/their investment objectives. Investments in the fund are not deposits or other obligations of, or guaranteed, or insured by BNPP AMS or its authorised distributors or its affiliates and are subject to investment risks, including the possible loss of principal amount invested. Returns may be affected by investment strategies or objectives, markets and economic conditions. Past performance of the fund(s) or the managers, and any economic and market trends or forecast, are not necessarily indicative of the future or likely performance of the fund(s) or the manager and the value of the investments in fund(s) may go down as well as up. Investors may not get back the amount they originally invested. Funds which are invested in emerging markets, smaller companies and derivative instruments may also involve a higher degree of risk and are usually more sensitive to price movements. Views and opinions included herein constitute the judgment of BNPP AMS and its affiliates at the time specified and may be subject to change without notice. BNP PARIBAS ASSET MANAGEMENT Singapore Limited - registered office at 20 Collyer Quay, #01-01, 20 Collyer Quay, Singapore 049319. Company Registration No. 199308471D. Copyright © 2020 Morningstar, Inc. All Rights Reserved. The overall star rating for each fund is based on a weighted average of the number of stars assigned to it in the three-, five-, and 10-year rating periods. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.