Caixin
Nov 24, 2022 10:04 AM
CX DAILY

CX Daily: Why China’s Index Fund Boom Has Been a Bust for Investors

Retail investors in China have flocked to index funds. Almost 60% of all shares in equity ETFs were held by retail investors by the end of June, according to analysts at Guosen Securities.
Retail investors in China have flocked to index funds. Almost 60% of all shares in equity ETFs were held by retail investors by the end of June, according to analysts at Guosen Securities.

Funds /

In Depth: Why China’s index fund boom has been a bust for investors

Fierce competition among Chinese money managers has energized the country’s $300billion index fund (指数基金) sector over the past three years, with the launch of hundreds of funds targeting specific themes (主题) and sectors (行业) including decarbonization, semiconductors, vaccines and national security.

Faced with a saturated market for broad-based funds that track major indexes (宽基指数基金) like the benchmark CSI 300, and struggling to stand out in a crowded field, smaller management companies are trying to attract investors by offering highly focused funds.

China-U.S. /

China and U.S. defense chiefs agree to keep lines of communication open

The Chinese and U.S. defense ministers agreed Tuesday to maintain communication and strengthen crisis management to ensure regional security, China’s defense ministry said.

Following a meeting between the two countries’ leaders at a summit last week, Defense Minister Wei Fenghe met his American counterpart Lloyd Austin Tuesday during the ASEAN Defense Ministers’ meeting in Phnom Penh, Cambodia.

FINANCE & ECONOMY

Former People’s Bank of China Governor Zhou Xiaochuan. Photo: VCG

Carbon /

Ex-central bank chief dismisses concerns of multinationals’ ‘greenwashing’

Former China central bank governor Zhou Xiaochuan said there is no need to be overly concerned about multinational corporate emitters buying cheap carbon credits from developing countries for “greenwashing” purposes as global carbon prices will level off eventually.

Zhou made the statement after the 2022 United Nations Climate Change Conference concluded over the weekend. The conference discussed allowing private companies to purchase carbon credits from governments, but some parties expressed concerns that such a scheme would allow large corporations to avoid their actual emission reduction responsibilities.

Wealthy /

Chart of the Day: China’s rich are getting richer

In China, more families got rich in 2021, and the ones who were already rich got a fair bit richer.

The number of Chinese households that entered the ranks of “high-net-worth families” last year rose 1.9% to nearly 2.1 million, with their aggregate wealth growing 27% to 160 trillion yuan ($22.4 trillion), according to a report released earlier this month by the Hurun Research Institute and Citic-Prudential Life Insurance Co. Ltd.

IPO /

Sunshine Insurance wins HKEX approval for $1 billion IPO

Private Chinese insurer Sunshine Insurance Group Co. passed a hearing for an initial public offering on the Hong Kong Stock Exchange, the HKEX said Monday.

The Beijing-based company won approval from China’s securities watchdog for its Hong Kong share sale. It was authorized to sell as many as 3.97 billion shares. Sunshine Insurance filed pre-listing documents with the Hong Kong exchange in April.

Quick hits /

China’s STAR Market hosts $102 billion of IPOs in first three years

Shanghai beefs up Covid rules for new arrivals starting Nov. 24

BUSINESS & TECH

Guangzhou Baiyun International Airport 

Flights /

Airlines complete only 70% of planned international China flights

Chinese and global airlines completed only 70% of their planned international flights to China in the three weeks through Monday, signaling that recent easing of some inbound travel restrictions didn’t boost travel demand.

From Oct. 30 to Nov. 21, 3,595 international flights reached Chinese cities, including Hong Kong, Macao and Taiwan. Although that was up from the same period last year, the total was still just 6% of the pre-pandemic level in 2019, according to VariFlight, an app that provides airline information.

Electric cars /

Chinese EV startup cuts salaries amid ballooning losses, sources say

WM Motor Holdings Ltd. is cutting salaries by half for management and nearly a third for staff members, Caixin learned, as the electric-vehicle (EV) startup struggles with sluggish sales and ballooning losses.

The Shanghai-based automaker began the cost-control measures in October, also canceling annual bonuses and vehicle purchases subsidies, the source said, citing a Monday internal memo.

Movies /

China’s Covid-hit cinemas hope ‘Avatar’ sequel will bring a galactic boost

The much-anticipated sequel to the sci-fi blockbuster “Avatar” will hit Chinese mainland theaters on the same date as its release in North American markets, with industry insiders hoping the movie will deliver a much-needed boost to the film industry, which has been hit hard by repeated Covid-19 lockdowns.

The U.S.-based 20th Century Studios said Wednesday on social media platform Weibo that the James Cameron-directed “Avatar: The Way of Water” will be released on the mainland Dec. 16.

Quick hits /

Chinese mechanical-equipment maker says its chair faces insider-trading probe

China slashes purchases of chipmaking equipment as U.S. restrictions bite

Volkswagen cuts China sales target as ‘zero-Covid’ still looms large

Long Read /

How China’s ESG policy is progressing

GALLERY

Saudi Arabia’s stunning victory over Argentina

 

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