AIG-Huatai Begins Selling First Mutual Fund in China

AIG-Huatai Fund Management Co. Ltd., a Shanghai-based joint venture between AIG Global Investment Corp. and Huatai Securities Co., sold its first mutual fund in China on Monday, according to China Daily.

The company hopes to capitalize on the long-term investment potential of China's capital market and said it will launch more fund products for Chinese investors in the next couple of years.

"We are very interested in the stock market and also the pension fund business. We will enrich our product line step by step in the coming years, based on the international expertise of AIG and the conditions of the local market," said Fu Teh-Hsiu, CEO of AIG-Huatai Fund Management.

In spite of a dull Chinese stock market last year, AIG-Huatai decided to launch an equity fund now because the market's supply of mutual funds is generally greater in the first quarter. The company is also targeting institutional investors, who, Fu said, are likely to be making their investment plans now.

AIG might increase its stake in the joint venture from the current 33%, according to insiders. "But whatever the equity structure is, our target is to be a local company that follows international standards," Fu said.

Investors in AIG-Huatai's equity fund are likely to have greater investment choices as more companies are expected to be listed domestically this year, said Jack Lee, manager of the new equity fund. Among the investment targets, blue-chip stocks are considered key, Lee said. He also recommended stocks in the consumer sector, which grew sharply last year, and bank stocks, which are poised for growth in light of reform in the banking sector.

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Money Management Executive
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