BlackRock Wants Investors to Increase China Exposure, Should You Follow?

Contact Your Elected Officials
The Epoch Times Logo

BlackRock, the world’s largest investment manager with more than $9 trillion in assets under management, recently made a very contrarian call.

The investing giant argued that China is no longer an emerging market and as such, investors need to boost their investments in Chinese stocks and bonds.

China is underrepresented in investors’ portfolios, Wei Li, chief investment strategist at BlackRock Investment Institute, told the Financial Times on Aug. 17.

BlackRock’s latest bullish call on China follows a research report it issued in May, which also argued that Chinese stocks and bonds allocation in global benchmark indices is too low. In that report, BlackRock said that global economic growth is becoming increasingly bipolar, led by the United States and China at opposite ends of that spectrum, and investors need exposure to both in almost equal measures.

It’s an especially contrarian view considering the recent pain surrounding Chinese stocks. 

Many experts are now questioning Chinese companies.

Goldman Sachs recently cut their rating on several Chinese firms, while UK hedge fund Marshall Wace has questioned whether Chinese stocks are investable in the near term.

More broadly, China’s A-shares have trailed global markets, and Chinese companies listed in the United States and Hong Kong have underperformed even more after recent regulatory crackdowns and compliance issues facing several well-known Chinese firms. 

So should investors trust BlackRock, the world’s largest asset manager, and double down on their Chinese investments?

Let’s analyze further.

First, let’s examine BlackRock’s motives and incentives. Its CEO, Larry Fink, has been trying to cultivate a strong relationship with Beijing for many years. BlackRock in June became the first U.S. asset manager to receive approval to establish a mutual fund business in China, a position “we are honored to be in,” Fink said in a statement at the time.

BlackRock also has one of the biggest rosters of investment funds with China exposure, including dedicated China funds, as well as Asian and emerging markets funds with China allocation. 

The firm’s flagship BlackRock China Fund, which has positions in Tencent, China Merchant Bank, and electric vehicle maker Xpeng, had assets under management of more than $1.5 billion as of Aug. 20. BlackRock also runs a China bond fund that invests in a variety of China fixed income products, including onshore and offshore RMB-denominated bonds, as well as USD-denominated offshore bonds.

In other words, BlackRock would be well-incentivized to drum up support for investing in China—it earns fees and other revenues from investors who put cash in their funds.

By Fan Yu

Read Full Article on TheEpochTimes.com

The Thinking Conservative
The Thinking Conservativehttps://www.thethinkingconservative.com/
The goal of THE THINKING CONSERVATIVE is to help us educate ourselves on conservative topics of importance to our freedom and our pursuit of happiness. We do this by sharing conservative opinions on all kinds of subjects, from all types of people, and all kinds of media, in a way that will challenge our perceptions and help us to make educated choices.

CHARLIE KIRK, YOU WEREN’T PROVED WRONG

"I want to be remembered for courage for my faith,” Kirk had said in a podcast merely two months ago. May his courage spur us to be bolder in our faith.

Trump’s Proposal For NATO To Stop Buying Russian Oil & Start Tariffing China Is Unrealistic

Trump proposed on social media that NATO stop buying Russian oil and start tariffing China 50-100% as part of his plan for ending the Ukrainian Conflict.

The Choices We Make

Death and disagreement are inevitable. Love and hate are choices. We will all die. Before we do, what choices will we make?

Elon Musk Speaks at Unite the Kingdom Rally

Tommy Robinson held rally, with Elon Musk appearing virtually, calling attention to leftist politicians who allow foreign immigrants to invade England.

Doxed Democrats Are Getting Fired Left and Left

Not a misprint because a title of “left and...

ABC Suspends Jimmy Kimmel: 5 Things to Know

ABC suspended Jimmy Kimmel indefinitely over remarks about Charlie Kirk’s assassination, following an FCC warning its head would act against the network.

Judge Rules Pro-Palestinian Activist Mahmoud Khalil Should Be Deported

A U.S. judge ordered pro-Palestinian activist and Columbia graduate Mahmoud Khalil deported after finding he omitted information on his green card application.

Charlie Kirk’s Widow, Erika, Named New CEO of Turning Point USA

Turning Point USA announced it named Erika Kirk as new CEO and board chair of Turning Point USA, which late husband, Charlie Kirk, co-founded.

Shares of Intel Increase 30 Percent on $5 Billion Nvidia Investment

Shares of Intel increased by about 30 percent at the opening bell after Nvidia announced a $5 billion investment in the struggling chipmaker on Sept. 18.

Trump, Starmer Seal Record $340 Billion ‘Tech Prosperity Deal’

President Trump and British PM Keir Starmer announced a new partnership worth $340 billion in technology, nuclear power, and private equity.

Rubio Says US Visa Revocations Underway After Charlie Kirk Death Celebrations

SoS Marco Rubio said foreign nationals who made celebratory comments over Charlie Kirk’s assassination will have their U.S. visas revoked.

Trump Supports Designating Antifa a Terrorist Organization

President Trump said he would support designating the antifa movement a terrorist organization in the wake of Charlie Kirk’s assassination last week.

US Conducts Strike on Another Drug Boat From Venezuela: Trump

Three people were killed in a U.S. strike on a Venezuelan drug boat, President Donald Trump announced on Sept. 15.
spot_img

Related Articles

Popular Categories

MAGA Business Central