China Securities Regulatory Commission (CSRC) has granted RQFII (Renminbi Qualified Foreign Institutional Investor) license to Carmignac which will allow it to invest in China’s mainland securities market.
The license will relax the country’s investment restrictions and offer access to A shares and local bonds denominated in RMB.
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The license will boost the firm’s investment universe to the Chinese domestic market where bond issuance amounts to US$ 5,000 billion and the market capitalization of the equity market is US$ 4,000 billion, which is more than twice that of Chinese companies listed overseas.
In addition, the license will enable Carmignac to tap into new investment opportunities associated to the growth of the Chinese economy.
Following the move, the management company will subsequently be issued a specific investment quota.
Haiyan Li-Labbe, China analyst at Carmignac, said: "The reforms embarked upon by the Chinese government are a short-term hurdle but offer excellent long-term potential, which is where we want to be able to position ourselves effectively."
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