BOCHK Asset Management has launched a new renminbi fund that will invest in the Shenzhen stock market to capitalize on the growth of new economy sectors in China.

The BOCHK All Weather CNY Equity Fund will invest in companies belonging to sectors including the Internet, technology, mobile communication, environmental protection and consumer sectors, which the bank believes are major drivers of China's "new economy."

"China's economic transformation is still at early stage. We believe the fund [investing in Shenzhen 'new economy' stocks] will offer long-term return to investors," Lam tells The Asset at sidelines of the fund launch press conference.

The new BOCHK All Weather CNY Equity Fund uses the Shenzhen Composite Index as benchmark which posted 31.82% growth in 2014, lagging behind the Shanghai Composite Index (54.01%), and CSI 300 (51.95%). But the Shenzhen market outperformed in the first quarter this year (38.4%), with the Shanghai Composite (15.9%), and CSI 300 (14.6%) also up. 

Lam says the fund provides special value as it helps investors to buy from 80 to 120 quality stocks out of about 1,700 shares listed in Shenzhen. The Shenzhen stock market  will soon be linked to the Hong Kong's bourse through a program similar to the Shanghai-Hong Kong stock connect. Lam expects the Shenzhen-Hong Kong program will only include several hundreds of stocks at initial stage.

The new fund will invest in the China equity market through the Renminbi Qualified Foreign Institutional Investor (RQFII) scheme, with initial subscription of 10,000 renminbi (US$1,611.4), US$1,000, and HK$10,000 (US$1,289) for the renminbi class, US dollar class and HK dollar class, respectively. The fund is available for subscription from today to June 5.

The All Weather Fund is a sub-fund under the BOCHK Wealth Creation Series that invest in equity and bond markets in China and Hong Kong.