Global Head of Securities Services, Standard Chartered
There have never been more foreign investors investing in China as general optimism about the market has been boosted by the availability of clearer, simpler access channels.
Now in its third year, our annual RMB survey of investors, regulators and custodians across Asia, Europe and North America shows that investor confidence about China is at its most bullish since we launched the survey in 2016, with more than four in five (88%) of respondents now investing in China, up from more than three in five (67%) in 2016.
Connects accelerate China investment flows
Index inclusion drives market development
Meanwhile, the inclusion of China’s A-shares into the MSCI Emerging Markets Index and the proposed entry of onshore bonds into the Bloomberg Barclays Global Aggregate Index are spurring market enhancements, as regulators and markets act to meet the inclusion criteria. Our survey suggests that index inclusion is already impacting investor behaviour, with 44% of respondents investing before rebalancing.
However, there are still issues that China’s regulators need to address. At our recent roundtables with clients, it was clear that the number and variety of access schemes is starting to weigh financially and operationally on investors, custodians and regulators. Rather than welcoming further new schemes, such as the upcoming London-Shanghai Connect, the industry’s preference is for harmonization across the existing access channels.
But for most investors, it seems the decision about whether or not to invest in China is no longer a question of if, but how. If the country’s regulators can iron out the remaining roadblocks, a new era of Chinese investment could really take off.
This material has been prepared by Standard Chartered Bank (SCB), a firm authorised by the United Kingdom’s Prudential Regulation Authority and regulated by the United Kingdom’s Financial Conduct Authority and Prudential Regulation Authority. It is not independent research material. This material has been produced for information and discussion purposes only and does not constitute advice or an invitation or recommendation to enter into any transaction.
Some of the information appearing herein may have been obtained from public sources and while SCB believes such information to be reliable, it has not been independently verified by SCB. Information contained herein is subject to change without notice. Any opinions or views of third parties expressed in this material are those of the third parties identified, and not of SCB or its affiliates.
SCB does not provide accounting, legal, regulatory or tax advice. This material does not provide any investment advice. While all reasonable care has been taken in preparing this material, SCB and its affiliates make no representation or warranty as to its accuracy or completeness, and no responsibility or liability is accepted for any errors of fact, omission or for any opinion expressed herein. You are advised to exercise your own independent judgment (with the advice of your professional advisers as necessary) with respect to the risks and consequences of any matter contained herein. SCB and its affiliates expressly disclaim any liability and responsibility for any damage or losses you may suffer from your use of or reliance on this material.
SCB or its affiliates may not have the necessary licenses to provide services or offer products in all countries or such provision of services or offering of products may be subject to the regulatory requirements of each jurisdiction. This material is not for distribution to any person to which, or any jurisdiction in which, its distribution would be prohibited.
You may wish to refer to the incorporation details of Standard Chartered PLC, Standard Chartered Bank and their subsidiaries at http://www.standardchartered.com/en/incorporation-details.html.