Main reference: Story in Securities Daily
THINGS ARE looking up for China’s capital markets with at least eight leading funds voicing strong optimism about 2013.
The Chinese New Year’s holiday is rich with tradition.
Among them is the custom of buying a new set of clothes to greet the new year.
Here’s why eight funds think 2013 will be sporting some shiny new duds – at least as far as the investment environment is concerned.
Invesco Great Wall was one of China’s best performing funds in 2011, with overall investor returns of close to 30%.
“We were able to anticipate the stabilizing trends in both policy and the macroeconomy as well as add value with broader involvement in energy-heavy funds and QDIIs. This helped our core competitiveness in 2011.
“And with the recovery beginning in Q4, we expect things to pick up even further in China in 2013,” said Invesco Great Wall Chief Investor Wang Penghui.
He added that he was more bullish on China’s all-important property market next year as well as expressing confidence in the new national leadership’s commitment to upgrade infrastructure amid the ongoing urbanization drive.
“Destocking appears headed for a resolution as orders are likely to pick up.”
He said his fund was particularly bullish on 2013 prospects for pharmaceuticals, insurance, white goods, consumer goods and electronics given the increasing urban population in China.
Lombarda China Fund Management Chief Strategist Zhou Weiwen said his firm also had a market-beating 2012, providing average returns of over 25.5% to investors.
He said Lombarda’s relatively heavier exposure to some of the recently recovering sectors like financials, property and coal put it in a better position vis-à-vis the competition.
“The year 2013 will see a business growth climate supportive of the A-share markets and is likely to be better than 2012. However, capital flows and government policy will play a large role in guiding market sentiment,” Zhou said.
He added that potential wildcards in 2013 include the possibility of rapid commodity and property price inflation.
Franklin Templeton Sealand Fund Management managed to rack up impressive 24.0% returns for its clientele in a decidedly bearish 2012.
The Fund is confident that for the first half of 2013, the A-share market will enjoy a relatively robust upside.
It said that for parts or the whole of 2013, the stronger expected economic growth in China and better anticipated earnings might make it the best time to invest in A-shares in over two years.
Fortune SG Fund Management gifted its clients with a 19.1% ROI in 2012 and also expects a rosier economic outlook for China in 2013.
It said that the overall capital market situation in China will become more attractive to investors thanks to more accessibility to a wider range of investment products including corporate bonds, trust funds and sovereign debt.
51 Fund had a 2011 ROI of 26.7%, thanks to its fortunate picks in the new energy and industry sectors.
It expects even better A-share sentiment in 2013 and is especially upbeat on established consumer brands, pharmaceuticals and environmental plays.
NC Fund, GTJA Allianz Funds and GF Fund Management also threw their respective hats into the “more bullish” on 2013 ring.
“The long-suffering A-share markets are suddenly showing signs of steadily increasing institutional investor interest.
“This coupled with the market reforms instituted by the new leadership and the gradually improving PRC economy will make for a better 2013 for A-share investors,” NC Fund said.
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