China crosses the Great Wall

Thu Jul 18, 2013

Armed with rapid regulatory liberalisation and significant indigenous talent, China’s hedge fund industry stands at a crossroads of transformation with immense possibilities for growth

  Wang Qing Sun Jie
  Juntao Yin Jiwu Chen
Pivotal to the transformation of China’s hedge fund industry is the new Investment Fund Securities Law, which came into effect on 1 June and has cleared away the regulatory ambiguity surrounding China’s home-grown hedge funds, also known as private funds or 'sunshine’ funds.

The Chinese government is making strong moves to build its very own hedge fund industry, allowing new fund management tools and taking the first steps to create a well-established self-regulation regime to nurture the nascent industry.

This has given birth to a thriving ecosystem whereby managers, investors, fund custodians, distributors and emerging prime brokers are all trying to make a mark on the developing industry.

Despite the country’s barely three-year-old derivatives market, the nation is seeing an increasing number of local investment managers determined to play the game right and to build world-class investment...

ISSN: 2151-1845 / CDC10004H

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