HONG KONG : Money managers in China are struggling to lure retail investors, with fundraising by mutual funds in the first five months of the year hitting the lowest in four years and few betting on a near-term rebound, amid diminishing returns and economic challenges.
The number is even lower than that of 2022 when many Chinese cities were under strict COVID-19 lockdowns, and is only one-third of the same period in 2021. "The wealth effect is missing," said Jiao Jinyuan, director of online distribution at China Asset Management."Client sentiment is unlikely to turnaround until they see an improvement in the wealth effect."
The fund soared 95 per cent in 2020 which attracted significant subscriptions and helped Zhang become China's first so-called"100 billion fund manager". It dropped 10 per cent in 2021 and 16 per cent in 2022. "The demand for active equity products is in particular weak," said Emily Gao, an analyst at Shanghai-based Z-Ben Advisors.