Wealth Manager - the site for professional investment managers

Register for full access to Citywire’s Fund Manager database, news and analysis. Registration is free and only takes a minute.

Allianz re-opens offshore renminbi fund after liquidity measures

Allianz re-opens offshore renminbi fund after liquidity measures

Allianz Global Investors has re-opened its Luxembourg-domiciled Renminbi Fixed Income fund, having soft-closed it at the end of last year to preserve liquidity.

The move to soft-close the Ucits fund came after assets rocketed to €450 million only two months after it launched.

Although the fund aims to invest in high quality issuers as the market matures, it will initially hold the majority of assets in renminbi deposits through inception, with initial yields of 1%-1.5%, to maintain Ucits compliance.

The fund, managed by Helen Lam, aims to deliver a total return, including currency appreciation, of around 5% over the long-term.

Lam will invest primarily in high grade CNH bonds – CNH denoting the currency being traded offshore, mainly in Hong Kong.

Lam said: ‘We expect that high grade quality CNH bonds should be able to offer a stable return of 3 – 4% through the attractive yield component.

‘We also expect to enhance the portfolio’s total return through duration positioning to capture the policy-driven interest rate movements in mainland China.’

She added: ‘Though the recent fundamental and cyclical factors in China seem to suggest a softening RMB appreciation outlook, we believe that the pace of RMB appreciation will remain stable going forward.

‘This should be supported by China’s strong commitment to the RMB Internationalisation process through the promotion of cross-border trade and investment flows. Recent data suggests that approximate one-tenth of China’s total trade is settled in RMB, up from only 2% two years ago.’

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Investment Pulse: the highs and lows of 2014

Investment Pulse: the highs and lows of 2014

This week's Investment Pulse looks back at some of the biggest stories of the year as well as looking forward to 2015.

Play Inside ETFs: Why the US bull-run still has legs

Inside ETFs: Why the US bull-run still has legs

Global equities suffered a sharp sell-off in the third quarter but exchange traded fund investors are continuing to back the US to outperform in 2015

Play Paul Niven: I won't rip up the Foreign & Colonial Trust history book

Paul Niven: I won't rip up the Foreign & Colonial Trust history book

The newly appointed manager of the Foreign & Colonial trust talks about his plans for UK's oldest investment company.

Your Business: Cover Star Club

Manchester wealth firm hires Coutts director for London launch

Manchester wealth firm hires Coutts director for London launch

Former Coutts director Tony Robinson has joined Chartered Wealth Management to head the company’s newly opened London office.

Wealth Manager on Twitter