Skip Ribbon Commands Skip to main content
 
Allianz Global Investors Insights | February 2017

February 2017

Global Investor Insights

Global View

Takeaways from Our Hong Kong Investment Forum

Twice a year, our investment professionals from around the world meet at our Investment Forum to exchange ideas on the issues that matter most to our clients, including new macroeconomic and market developments and long-term investment themes. Our first Investment Forum of 2017 was held in the vibrant city of Hong Kong – a fitting location for an event with China as the lead agenda topic. Here are some of the highlights of our discussions.

Perspective on the Asia Pacific

Extracting Alpha from China’s Equity Markets

When many investors think about China today, they focus on a few well-publicized macroeconomic concerns: property bubbles, non-performing loans in the banking system or the renminbi’s weakness against the US dollar. In our view, these are all valid issues, but we see investing in China as more of a bottom-up story – one that can reward active investors who understand the size and subtleties of a booming marketplace.

Consider that there are now more than 4,200 Chinese companies listed on stock exchanges around the world – mostly in Shanghai, Shenzhen, Hong Kong and the US – with a total market-capitalization size of USD 10 trillion. That means there are more listed companies in China than in the US. As in the US, the sheer size of this group means there are always interesting companies to be found. But unlike in the US, many inefficiencies still exist in China’s equity markets – and it is here where active managers have an opportunity to deliver alpha to investors.

Viewpoint

The Capital-Market Implications of China as an Asset Class

For investors, China can be a polarizing subject. A few years ago, many believed the country would play a crucial role in pulling the global economy out of the Great Financial Crisis, and that China’s growing economic power would be the most compelling investment story of the 21st century. For other investors, the extreme market volatility of recent years has given rise to growing concerns about the credit-fuelled nature of China’s economic development, and worries about whether China will successfully make its much-needed “rebalancing” transition to a different type of growth model.

But whether you’re a China bull or a China bear, China’s capital markets will likely become significantly more important to the global financial system in the coming years. And as China’s capital markets become truly accessible to global investors for the first time, investors may need to rethink the way they will access China in the future.

To read the insight in full, please click here
Investing involves risk. The value of an investment and the income from it will fluctuate and investors may not get back the principal invested. Past performance is not indicative of future performance. Equities have tended to be volatile, and unlike bonds do not offer a fixed rate of return. Emerging markets may be more volatile, less liquid, less transparent and subject to less oversight, and values may fluctuate with currency exchange rates. Bond prices will normally decline as interest rates rise. Below investment grade convertible and fixed-income securities involve a greater risk to principal than investment grade securities. This is a marketing communication. It is for informational purposes only. This document does not constitute investment advice. References to specific securities are not intended to be, and should not be interpreted as an offer, solicitation or recommendation to purchase or sell any financial instrument, an indication that the purchase of such securities was or will be profitable, or representative of the composition or performance of any AllianzGI product.

The views and opinions expressed herein, which are subject to change without notice, are those of the issuer or its affiliated companies at the time of publication. Certain data used are derived from various sources believed to be reliable, but the accuracy or completeness of the data is not guaranteed and no liability is assumed for any direct or consequential losses arising from their use. The duplication, publication, extraction or transmission of the contents, irrespective of the form, is not permitted. This material has not been reviewed by any regulatory authorities. In mainland China, it is used only as supporting material to the offshore investment products offered by commercial banks under the Qualified Domestic Institutional Investors scheme pursuant to applicable rules and regulations.

This document is being distributed by the following Allianz Global Investors companies: Allianz Global Investors U.S. LLC, an investment adviser registered with the U.S. Securities and Exchange Commission (SEC); Allianz Global Investors Distributors LLC, a broker-dealer registered with the SEC; Allianz Global Investors GmbH, an investment company in Germany, authorized by the German Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin); Allianz Global Investors Asia Pacific Ltd., licensed by the Hong Kong Securities and Futures Commission; Allianz Global Investors Singapore Ltd., regulated by the Monetary Authority of Singapore [Company Registration No. 199907169Z]; and Allianz Global Investors Japan Co., Ltd., registered in Japan as a Financial Instruments Business Operator; Allianz Global Investors Korea Ltd., licensed by the Korea Financial Services Commission; and Allianz Global Investors Taiwan Ltd., licensed by Financial Supervisory Commission in Taiwan. GrassrootsSM Research is a division of AllianzGI Research. Data used to generate GrassrootsSM Research recommendations is received from reporters and field force investigators who work as independent contractors for broker-dealers. Those broker dealers supply research to AllianzGI and certain of its affiliates that is paid for by commissions generated by orders executed on behalf of AllianzGI’s clients.

No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. Allianz Global Investors is a trademark, registered in various countries throughout the world, including the United States. © 2016 Allianz Global Investors.

All rights reserved.

Twitter

Twitter
Follow our UK Twitter feed for our latest insights.
Tweets by @AllianzGI_UK...

Risk matters

ESG Matters
Risk matters is our publication which aims to keep our clients up to date with the latest developments in all facets of risk.more...

Bond Issues

Bond Issues
Visit our Bond Issues blog, focussed on the latest issues in fixed income, where we aim to separate the delta from the duration and the carry from the convexity.more...

Project M

ESG Matters
The Allianz SE International Pensions team multiply investment and retirement knowledge. Find out why the Project M team has won 19 corporate publishing awards.more...
 
Investing involves risk. The value of an investment and the income from it may fall as well as rise and investors may not get back the full amount invested.