Eastspring Asset Management Launches 'Eastspring China Leaders Fund'

[Asia Economy Reporter Minji Lee] Eastspring Asset Management Korea announced on the 5th that it will launch the 'Eastspring China Leaders Fund,' which selectively invests in China's new growth industries.

This fund was launched by changing the investment strategy and stocks of the existing 'Eastspring China Dragon A&H Fund' to focus on new growth companies that will have competitiveness in the post-COVID-19 era, and accordingly renewing the fund name.

This is a fund of funds that invests in the offshore fund 'Eastspring Investment China A Share Growth Fund,' managed by Eastspring Investment Singapore Limited since April 2019. As of the end of August, the investee fund recorded a 6-month return of 37.0% and a 1-year return of 63.9%, outperforming its benchmark MSCI China A USD Gross Index by 7.5% over 6 months and 23.4% over 1 year.

The Eastspring Investment China A Share Growth Fund mainly invests in sectors related to the 'New Economy' (新經濟) that benefit from the paradigm shift in China's economic growth. In particular, following the outbreak of COVID-19, the Chinese market minimized economic damage through strong monetary and fiscal stimulus measures by the government, and the fund adopts an investment strategy that selectively approaches companies in consumer goods, healthcare, and next-generation technology sectors expected to experience rapid and strong growth. Additionally, it is an all-China fund investing broadly in Chinese companies, including mainland China A-shares, Hong Kong-listed H-shares, Red Chips, and ADRs listed on the U.S. stock market.

The Chinese consumer goods market, which accounts for more than 70% of the total GDP, is rapidly growing despite the overall economic slowdown. In fact, the size of the Chinese consumer market is expected to grow to $13.9 trillion (approximately KRW 1,660 trillion) by 2030. Furthermore, the healthcare industry, which has been gaining attention due to population aging and rising middle-class income levels, is accelerating growth with the expansion of public medical infrastructure. IT-based next-generation technology companies are also noteworthy as the Chinese government is fostering them as future strategic industries, highlighting their competitiveness.

The investee fund focuses on a strategy to identify companies in these sectors that possess strong growth potential, sustainable profitability, and high management credibility. Moreover, it plans to pursue long-term excess returns over the market by utilizing a bottom-up stock analysis approach based on comprehensive views of macroeconomic environment, policy changes, and industry trends.

To maximize this investment capability, the investee fund utilizes research advisory services from Eastspring China, a China equity specialist asset management company based in Shanghai. With the perspective of local analysts and investment professionals who deeply understand Chinese companies, it approaches the Chinese stock market relatively thoroughly and accurately.

Jongseok Park, Executive Director of Product Marketing at Eastspring Asset Management, said, “Since the outbreak of COVID-19, investors paying attention to the new China and new growth industries are increasing in line with the rapidly changing paradigm of the Chinese economy.” He added, “The 'Eastspring China Leaders Fund' can provide an opportunity to selectively invest in the vast Chinese stock market through Eastspring’s research capabilities as Asia’s regional investment experts.”

This content was produced with the assistance of AI translation services.