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HSBC renminbi bond fund gets official launch

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1 HSBC renminbi bond fund gets official launch on Fri Oct 28, 2011 4:03 am


HSBC renminbi bond fund gets official launch by Atholl Simpson

on Oct 27, 2011 at 12:50

HSBC Global Asset Management has announced the launch of a Chinese currency bond fund which will offer investors access to renminbi investments.

The HSBC GIF RMB Fixed Income fund, which Citywire Global first reported on back in August before its official launch, will be run by the firm’s Hong Kong-based manager Cecilia Chan.

Chan has been working HSBC for 17 years and believes the investment case for the renminbi (RMB) is strong given its potential for appreciation.

‘The Chinese authorities have allowed a managed appreciation of the currency to cool the economy and to ease international relations with trading partners who objected to the advantageous terms of trade that a weak renminbi has meant for China,’ said Chan.

‘This process still has further to go and the renminbi has the potential to be one of the world’s major reserve currencies in the future.’

The fund will focus on offshore RMB denominated instruments including RMB denominated bonds and RMB deposits. There will be diversified credit exposure and the investment approach will combine a rigorous top down approach with bottom up fundamental analysis.

According to the firm, the RMB market is characterised by shorter duration instruments and so the average duration of the fund is likely to be in the 1-3 year range.

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