Threadneedle is setting up a China opportunities fund to be managed by Gigi Chan.
It will focus on the investment themes of domestic consumption, urbanisation and infrastructure spending, taking a bottom-up approach to stockpicking. Jan de Bruijn will be deputy fund manager.
The portfolio will sit alongside Threadneedle’s £2bn portfolio of Far East and Asia equity funds and Chan says she will predominantly be investing in small and mid-cap Chinese stocks.
“We have spotted lots of opportunities in the mid to small cap segment of the market, which is quite under-researched,” says Chan. “Liquidity inflows have gone mainly into large caps, which have become less attractive in terms of valuation.”
Threadneedle Asia fund manager and head of Far East and Asian equities Vanessa Donegan says: “We are high-conviction believers in China and the opportunities yet to be exploited by investors. We are excited by China’s long-term prospects because of its strong corporate profits, robust economic growth and pent up investor demand.
“Gigi is an impressive stockpicker and her early call to go overweight in China was a key driver in the outperformance of the company’s Asia fund.”