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State Street wins Guotai Nasdaq 100 index mandate
The Guotai NASDAQ-100 Index is the first index-linked financial product to offer Chinese investors access to stocks listed on an overseas exchange. Investments will be made through the QDII program
Bayani S Cruz 17 Jun 2010
State Street Corporation has been appointed as global custodian and trading service provider to the Guotai Nasdaq-100 Index Fund, reasserting itself as a major service provider under the Qualified Domestic Institutional Investor (QDII) program.
 
The Guotai NASDAQ-100 Index, which opened for subscription on March 22, is the first index-linked financial product to offer Chinese investors access to stocks listed on an overseas exchange. Investments will be made through the QDII program.
 
The fund is managed by Guotai Asset Management Co Ltd. China Construction Bank will act as the local custodian.
 
Guotai Asset Management received a USD700 million investment quota under QDII earlier this year. The Guotai NASDAQ-100 Index gives Chinese investors access to component stocks of the NASDAQ-100, access to an exchange traded fund (ETF) of that index, and to money market instruments and other approved financial instruments.
 
State Street managing director and senior vice-president, Sau Kwan, says the mandate involves the bank offering a range of integrated investment servicing solutions to the fund, including global custody, fund accounting, investment compliance reporting services, foreign exchange and portfolio research and trading solutions.
 
“This opportunity is historic for Chinese investors to invest in Nasdaq-listed companies. Our global approach to investment servicing, research and trading, and vast experience with index-linked products makes us uniquely suited to service China’s growing funds market,” Kwan says.
 
The NASDAQ-100 comprises many of the world’s largest non-financial stocks. Guotai has an exclusive licensing agreement with the NASDAQ-OMX Group to use the NASDAQ-100 Index in the development of financial products in China.
 
State Street has been actively involved in China’s financial landscape since 1997, working with many of its leading financial institutions including China Construction Bank for which it acts as a global partner serving the QDII sector. In 2005, it established its presence on mainland China when it opened a representative office in Beijing.
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