China International Fund Management (CIFM), a joint venture between JP Morgan Asset Management and Shanghai International Trust & Investment, has become the first Mainland fund manager to obtain the Qualified Domestic Limited Partner (QDLP) qualification for overseas investments.
A CIFM’s spokesperson told Asia Asset Management that the firm has been granted a QDLP quota of US$100 million. Prior to CIFM, foreign institutions, including UBS Global Asset Management, Deutsche Asset & Wealth Management, Nomura Asset Management, EJF Capital and CBRE Global Investors, were reported to have obtained a QDLP qualification earlier this year.
The Shanghai-based QDLP programme allows global asset managers to raise funds from domestic investors to buy overseas alternative assets such as hedge funds and real estate investment trusts (REITs).
According to CIFM, the firm’s first QDLP product will be geared towards hedge fund investment, which focusses on global asset allocation, via a hedge fund manager.
CIFM expects Mainland investors to enhance their focus towards overseas asset allocation, amid wealth accumulation and a loosening of the country’s financial policies. The Shanghai-based firm also believes that in the current financial climate, fund managers should be working towards providing investors with products that can yield steady returns. The comment comes after wild fluctuations in Mainland markets that prompted investors to become more risk averse.
In the initial phase of the QDLP programme, launched in 2013, only six hedge fund managers, including US-based firms Och-Ziff Capital Management Group and Citadel, and UK-based Man Group, received a quota of $50 million each. Earlier this year, Man Group announced that its QDLP fund had received placements from Chinese institutional investors including ICBC and Citic Trust.
