US fund aiming at Chinese marketAs one of the most full-fledged fund markets in the world, the US boasts of over USD 7 trillion worth of fund market scale which is still soaring up at a considerable speed. Various funds are pumped into the stock market, bonds or other areas for generous returns. The booming Chinese economy is increasingly attracting the attention and favor from the US fund investors.Generally speaking, the US fund investors are upbeat about the prospect of the Chinese market. Their optimism lies in two factors. First, China's economy is on the up-and-up in a stable and sustained way. The year of 2003 saw China's economy develop at a pace of 9.1 percent. Many American economists believe that the growth of China's economy will not be slower than this in 2004. Second, China's population of 1.3b constitutes a huge market. It has become an integral part of the world market after it acquired WTO membership. Nobody can afford to ignore the indefinite business possibilities here in China. At present, the enthusiasm among American fund investors toward the Chinese market is still rising. The statistics of a leading US fund service showed that USD475m went to fund targeting at the Chinese market last year. This is a remarkable growth rate. There are about 10 relatively powerful fund managers focusing investment in China. Their investment is channeled not only into China's stock and bond market, but also into securities in China's neighboring markets, which have close economic relations with China. Besides, some capital funds from the so-called newly emerging market in the US have also been put into the Chinese market. Data showed that in the past five years, funds taking China as the target market of the capital generated an overall return of about 18 percent, with the highest two up to 27 and 23 percent respectively. What's worth of noticing is the two distinctive characteristics of the American fund in China. First, they entered into China from a mature market. A mere faction of American fund is invested to buy China's B share. This is true even for those most aggressive companies. Take the famous Mattews China Fund for example. It puts 67 percent of its stakes into Chinese corporate stocks listed in Hong Kong, 23 percent into Chinese companies listed in other part of global market, and only 4 percent into China's B share. Secondly, some funds went round by investing in China's neighboring markets economically closely inter-linked with China to get exempt from fluctuations of China's stock market. In this way they will capitalize from the growing Chinese economy on the one hand and on the other, ward off potential risks in direct investment in China. Market analysts argue that from a long-term point of view, the Chinese market is too delicious for American fund investors to resist. With the sustained expansion of China's economy, more and more fund investment companies and fund investors in Wall Street have put the slogan of "investing in China" into action. However, if China wants to attract more American fund investors, it is important for China to secure a stable social and economic environment and a sustainable healthy growth. But it is even more important to improve its market environment, especially upgrade the management and financial transparency of the listed companies. By People's Daily Online |
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