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Hermes IM and Asian firm team up for A-shares fund launch

Hermes IM and Asian firm team up for A-shares fund launch

Hermes Investment Management has teamed up with an Asian asset management firm to launch a Ucits-compliant A-shares fund.

The UK group will work with CSOP Asset Management to access strategies run by so-called 'sunshine managers' operating in the country.

The fund, formally called the CSOP Hermes A Share fund, will tap into unconstrained portfolios currently being offered to high-net worth and institutional investors investing in the Chinese market.

Hermes IM and CSOP Asset Management said the new fund was the first of its kind to grant international investors direct access to China’s sunshine managers.

Commenting on the new launch, Mike Curry, co-head of Hermes Asia said: ‘CSOP’s knowledge of the Chinese market allows us provide access to a specialist area that has previously been off-radar to international investors.'

'With ongoing reforms, structural shifts and growing liberalisation, China is currently presenting exceptional opportunities for best-in-class stock pickers.’

CSOP and Hermes said they will act respectively as the investment manager and the investment advisor of the fund.

The asset managers added they will engage with three-to-five sunshine managers, who will focus on investment opportunities arising from economic growth and structural reforms in China.  

The fund will invest directly in A-shares through the CSOP's Renminbi Qualified Foreign Institutional Investor (RQFII) quota. The Hong Kong-based company said it is currently the largest RQFII manager globally and has allocated quota specifically for the new fund.

In his latest commentary, Citywire AA-rated manager and head of emerging markets at Hermes Investment Management Gary Greenberg said China will benefit from slower economic growth as the government's reform plans have put it firmly on the right path.

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