While COVID-19 weighs on global markets, we believe China is in a better position compared to markets elsewhere, as it is at the later stage of the virus outbreak and embarking on the path of recovery.
COVID-19 has been a very good test of the standalone China thesis. If you look at how global markets have performed, they have been down around 25%, yet the China A-share market has been down around 3%.
Despite the near term challenge from COVID-19, we remain confident in the fundamental, long-term changes playing out in China.
Gian Plebani, Portfolio Manager for China Allocation Opportunity strategy, is positive on China equities and China bonds compared to other global markets. Instead of being focused on one asset class, he believes China multi-asset strategies offer a one-stop solution with access to both equity and fixed income (onshore and offshore) and the flexibility to allocate between them as market conditions change. This risk-aware balanced investment approach allows investors to access Chinese growth and income with less than half the volatility of the equity markets.
"Active asset allocation approach can help investors achieve better risk-adjusted returns, particularly in a volatile market environment." he adds.