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在线翻译:
szdaily -> Markets -> 
Sovereign fund gears up to invest at home
    2018-07-16  08:53    Shenzhen Daily

CHINA Investment Corp. (CIC), the nation’s US$941 billion sovereign wealth fund, wants permission to invest in domestic stocks and bonds for the first time, sources with knowledge of the matter said, as it tries to end restrictions on its mandate following government moves to open up financial markets.

CIC has laid the groundwork for an application to the Central Government to let it invest in domestic capital markets, the sources said. It isn’t clear whether CIC has submitted the request or whether authorities would grant approval, the sources said.

Letting CIC invest at home would add a deep-pocketed buyer at a time when China’s equity and bond markets are under pressure from a trade war, a slowing economy and rising defaults.

At a public forum last month, CIC’s head of asset allocation Fan Hua said she saw “very good opportunities” in A shares and yuan-denominated bonds should the fund be allowed to invest. The valuations of domestic shares are “very attractive” after recent declines as compared with other markets globally, Fan told a forum in Beijing on June 29. Many Chinese companies still enjoy robust profitability even as the economy slows, she said.

CIC has been primarily restricted to investing overseas since it was set up in 2007, with money from China’s swelling foreign exchange reserves. The fund is turning its eye on domestic securities as Chinese stocks have gained inclusion in MSCI Inc.’s indexes for the first time, widening their appeal to overseas investors. The government has also taken a series of steps to widen foreign investors’ access.

CIC reported its best annual performance ever in 2017, as its stock holdings, which account for the largest portion of its overseas portfolio, benefited from soaring markets worldwide. The wealth fund is boosting allocations to direct and alternative investments for more stable returns and to cut exposure to volatile public markets, company executives have said.

CIC had US$14.8 billion in cash and bank deposits at the end of last year, according to its annual report.

Almost two-thirds of CIC’s overseas portfolio was farmed out to third-party asset managers as of Dec. 31. Changing the fund’s mandate to include domestic securities would remove a potential conflict should those firms want to invest onshore, one of the sources said. Just over 1 percent of CIC’s overseas portfolio, the size of which isn’t publicly disclosed, was in cash as of year-end. (SD-Agencies)

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