Investors demand more frequent reporting in wake of China crisis
Investors are demanding more frequent reporting from their China-focused fund managers in the wake of the massive downturn that hit the A-share market.
The massive correction has left many investors, particularly private banking clients and high net worth investors, panicky because of market uncertainty and the unpredictable nature of regulatory response.
Because of this, some investors are demanding more frequent, even daily reporting from their fund managers in order to have a better awareness and understanding of their portfolio positions.
“We’ve had more communication than normal with our investors but other managers have told me they’re communicating daily because they have investors who have panicked. Fortunately, we have not had that,” says Michelle Leung, chief executive officer of Xingtai Capital.
Unlike many other China-focused fund managers Xingtai, a long-only absolute return fund specialising in consumer driven companies, anticipated the market correction and performed relatively well. It posted performance that was down only 1% in July when a lot of long-only fund managers were down around 6-10%.
“After April we were expecting a massive correction, but we didn’t know what form it would take. We decided to come down in our exposure and unloaded in May. We decided we’re going to stay in defensive, high conviction ideas,” Leung says.
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