After raising 6.68 billion yuan ($1.03 billion) during a brief subscription period, BlackRock’s China mutual fund affiliate launched its first fund in the nation, signaling a positive response from investors.
Wednesday’s announcement comes a day after billionaire investor George Soros claimed BlackRock was making a mistake by investing in China now, and that its clients are certain to lose money.
The newly-launched China equity fund of BlackRock, the first international asset management to operate a wholly-owned company in China’s $3.6 trillion mutual fund market, has raised 6.68 billion yuan from more than 111,000 investors.
The BlackRock China New Horizon Mixed Securities Investment Fund, which began accepting new subscriptions on Aug. 30, ended a week earlier than expected on Sept. 3.
Rachel Lord, BlackRock’s chair and head of Asia-Pacific said in a statement, “We are very proud of attaining this milestone for our China fund management business, and we are grateful for investors’ tremendous support.
As more global competitors prepare to enter China’s fast-growing but extremely competitive mutual fund sector, the world’s largest asset manager’s fundraising is being intently monitored.
Fidelity International is establishing a mutual fund subsidiary in China, while Neuberger Berman, Schroders PLC, and VanEck have also sought to open retail fund sales offices in China. On April 1, 2020, Beijing lifted a foreign ownership cap in the sector.
Soros, writing in the Wall Street Journal on Tuesday, termed BlackRock’s investment in China a “tragic blunder” that will jeopardize the US and other democracies’ national security interests.
Chi Zhang, general manager of Shanghai-based BlackRock Fund Management Co, said on Wednesday that the asset management was committed to providing long-term investment possibilities for Chinese clients by using its track record and expertise in investing in China A-shares.
BlackRock has a minority-owned Chinese mutual fund venture and recently established a majority-owned Chinese wealth management company, having entered China more than 15 years ago.
