After being investigated by the US House Select Committee for supposedly funneling American assets into stocks of blacklisted Chinese firms, BlackRock, the largest asset management company in the world, announced the closing of an offshore China equity portfolio. & nbsp,
According to Denise Voss, president of BGF, BlackRock Global Funds decided to discontinue the China Flexible Equity Fund due to a lack of new buyer interest.
Since August 24, when the fund’s net asset value ( NAV ) was roughly US$ 21. 4 million, no more subscriptions have been received. The fund’s NAV fell by 30.5 % the previous year. It was 25 % lower at the end of last year than it was in October 2017. & nbsp,
Managers” do not hope to raise significant additional membership in the near future ,” and” continuing to manage the account at this length will result in a higher price of investment that we believe is not in shareholders’ best interests ,” according to Voss.
The property in the fund’s underlying investment portfolio will be sold. On or before November 7, all outstanding shares may be redeemed. The fund’s shareholders have the option to change their opportunities to another account.
BlackRock assured the internet on Thursday that it is still firmly committed to the Chinese market. & nbsp,
It refuted reports that it was cutting off opportunities in China. BlackRock is not going to stop operating its onshore funds that have raised money in China, according to & nbsp, which stated that the China Flexible Equity Fund is for offshore investors.
scrutinized by politicians in the US
The US House Select Committee on Strategic Competition between the US and the Chinese Communist Party informed BlackRock CEO Larry Fink and MSCI CEO Henry Fernandez on July 31 that their businesses were being investigated in relation to investments in specific Chinese firms.
The House select committee reportedly requested information from BlackRock and MSCI regarding their cooperation of US opportunities into around 50 Chinese companies that had been placed on a blacklist due to allegations of participation in alleged human rights violations or support for the Chinese army.
In a statement, BlackRock stated that it handles all assets in China in accordance with all relevant US regulations. & nbsp,
The research and the closing of BlackRock’s China Flexible Equity Fund are clearly related, according to observers.
According to social observer Chau Sze – tat on his YouTube channel,” The rising costs faced by BlackRock in China do not only suggest operating costs but also the dangers of growing political pressure from the US politicians.” In addition, & nbsp,
He claims that in the history, when US resources were profitable in China, they would not have given a damn if the US looked into it. BlackRock has since discovered that its customers no longer care about Chinese securities. To prevent problems, why not shut down its China Equity Fund?
Before US President Joe Biden signed an executive order restricting US money and businesses from investing in China’s silicon, quantum computing, and artificial knowledge fields on August 9, the investigation was launched. & nbsp,
As they exclude the ergonomics and clean energy industries, the investment restrictions are said to be softer than anticipated. Only businesses with at least 50 % consolidated earnings, net income, cash expenditures, or operating costs related to the protected business will be targeted. It implies that even though their products have invested in AI, US money can also trade stock of Tencent and Alibaba.
dumping A stocks
Net sales of A shares by offshore traders in August totaled 90 billion yuan( US$ 12.4 billion ), according to a report by The Financial Times on August 31. International investors, according to analysts, were disappointed that Beijing had not yet announced a more specific loan for developers of heavily indebted properties.
The Shanghai Composite Index dropped 1.13 % on Thursday, closing at 3,122. But so far this year, it has increased by 0.19 %. To reach 10, 321 on the Shenzhen Component Index, the decline was 1.84 percent. This time, it has lost 7.16 % of its value. In addition, & nbsp,
Given that many local individual owners have even lost money in recent years, some Taiwanese critics claim they do not hold BlackRock responsible for the closing of its China Flexible Equity Fund. & nbsp,
A Chinese blogger claims in a video posted on Thursday that it is difficult for individual traders to profit from the A-share businesses because some listed companies have fallen below their initial public offering costs. China’s property markets appear to have been created solely for business raising, not for financial gain by buyers.
He claims that although the amount of A-share firms has increased over the past ten years from 1,000 to 6, 000, not many of them are of high quality. He claims that listing regulations should be improved to boost investment trust. & nbsp,
In an article, a Guangdong-based financial blogger claims that BlackRock’s Foreign fund managers lack the knowledge necessary to avoid errors like investing in some very volatile stocks, like equipment supplier Suzhou Maxwell and solar panel manufacturer JinkoSolar.
Suzhou Maxwell has lost 59 % over the past year, while JinkoSolar has fallen 52 %. For the same time span, the Shanghai Composite Index has just dropped 3.5 %.
Tony Tang, China brain of BlackRock, resigned in June. All 12 of BlackRock’s China inland cash suffered losses as a result of this. Tang later became the China brain of Citadel LLC, an American wall bank. & nbsp,
BlackRock China New Horizon Mixed Securities Investment Fund A has experienced a 29.9 % decline over the past two years, compared to 30.55 % loss for the same fund. & nbsp,
Study: MSCI and BlackRock looked into opportunities in China
At & nbsp, @ jeffpao3 is Jeff Pao’s Twitter account.