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nordea awarded chinese trading licence

Expert Investor Europe’s latest research trip to Frankfurt revealed that fund selectors from Europe’s biggest market are stepping up their allocation to Asian equities again, signalling the bearish sentiment towards the asset class among European investors is changing. Earlier research this year in Norway, Sweden and Switzerland pointed in the same direction.

Awarded by the Chinese government, the RMB Qualified Foreign Institutional Investors (RQFII) license allows the company to trade directly on the stock exchanges in Shanghai and Shenzen in the China A-Share Market.

Allan Polack, Nordea’s head of asset management, said: “We have acquired a very exclusive access to a stock market which is expected to grow considerably and become more open to foreign investors in the coming decades, and which is currently priced at attractive valuations.”

”Equipped with this license and the partnership with Libra, we are able to provide institutional and retail investors with the opportunity to invest directly into the China A-share market in a responsible and prudent manner.”

Third largest stock market

China’s A-share market is ranked as the third largest equity market in the world with around 2500 shares listed and a total market cap of approximately $4trn (€2.9trn). But foreign investors currently account for less than 2% of the total trade.

In January, fund manager Ashmore became the first company to receive an RQFII licence.

Christoph Hofmann, global head of distribution at Ashmore, said at the time: “The Chinese investment market is one of the most dynamic in the world, and securing this licence from the CSRC is a reflection of Ashmore’s long-standing commitment and deep ties to China.”

The investment index compiler MSCI plans to include China’s mainland-based A shares into the MSCI Emerging Markets Index from May 2015.

Nordea Asset Management is part of the Nordea Group and has assets under management totalling €233bn. Its business area offers investment funds to banks, asset managers, independent financial advisors and insurance companies.

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