UBS sets new entity with $100m corpus in Shanghai; to invest in alternatives, overseas assets

Photo: Reuters

UBS Asset Management announced on Thursday that it has created an entity in the Shanghai free trade zone to raise private funds in China to invest overseas via China’s Qualified Domestic Limited Partner (QDLP) scheme.

UBS said that the new company is a wholly owned foreign enterprise that will manage Chinese investments in both alternative and traditional overseas asset classes, with an initial quota of $100 million.

“Our participation in the QDLP program enhances the access to the international markets for our Chinese clients,” said Ling Xinyuan, China Chairman of UBS Asset Management, in a statement.

UBS is following other fund managers including BlackRock Inc , Och-Ziff Capital Management Group LLC and Man Group PLC, all of which are using their access through the QDLP programme to tap high net-worth Chinese individuals and institutional investors for cash to invest overseas.

Unveiled in 2012, the QDLP licence is designed to allow foreign alternative asset managers, namely hedge funds, to raise funds onshore to invest offshore. The first round of licenses was granted in 2013.

In focus is how successful the QDLP funds will be, and how welcoming Beijing will be.

On the one hand China is trying to cautiously open its capital account to allow more outward portfolio investment flows, seen as key to winning greater international support for the yuan’s inclusion in the International Monetary Fund’s basket of reserve currencies, and encouraging more foreigners to hold yuan assets.

On the other hand, China is seeing record capital outflows as the yuan comes under depreciation pressure, and that could ultimately complicate the short-term goal of lowering domestic interest rates.

QDLP, along with its cousin the Qualified Domestic Institutional Investor (QDII) programme and the Shanghai-Hong Kong Stock Connect, all offer investors inside China the chance to invest more outside China.

However, so far QDII and the Shanghai-Hong Kong Stock Connect have struggled to attract Chinese investors, which fund managers have blamed on poor management and marketing, combined with perceived superior returns at lower risk from domestic assets.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.