China’s NCSSF ups purchases in A-share market
08 November 2012
News, Asia, China
By Asia Asset Management
The National Council for Social Security Fund (NCSSF), the official body which oversees China’s 870 billion yuan (US$138 billion) supplementary pension fund, stepped up its purchases of A-share equities in the third quarter, according to a report from China Securities Journal on Thursday (November 8).
The fund’s intention has been to take advantage of market downside, as the price-to-earnings ratio (PE ratio) of the A-share market has been well below its historical average.
In the third quarter, the NCSSF purchased a total of 6.34 billion shares in 343 A-share listed companies, while the Shanghai Composite Index dropped by 6.26%. The pension fund increased its A-share holdings by 5.09 billion shares in the previous quarter.
The NCSSF was largely overweight the construction, food and beverage sectors, and underweight the machinery sector between July and September. Up to the end of September, the pension fund owned 50.4 billion yuan worth of A-share equity assets.
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