China Bonds

China Bonds

Investing in China bonds since 2002, we seek to add value over the medium term through active management of sector allocation, duration and yield curve strategy across the China bond universe.

Our edge

Award winning bond team that has invested across multiple economic cycles.
Significant scale of Asian operations establishes strong positioning with counterparties and market access.
Ability to offer benchmark as well as absolute return solutions across China’s corporate, sovereign, quasi-sovereign bonds in USD and RMB.
Rigorous credit process with an emphasis on proprietary research.

Investment Philosophy

We invest with a medium-term view.
We believe that investing on the back of fundamental, valuation and technical analysis can generate superior long-term returns.
Cyclical extremities in interest rates and credit spreads give rise to opportunities.
Shifts in investor risk perception can also create opportunities as assets get mispriced, relative to their fundamentals.

Investment Process

Investment outlook & fair value analysis
We conduct macroeconomic and market research to determine the investment outlook and establish the fair value of the broad interest rate, credit and currency markets.
Strategy formulation
We combine fundamental, valuation and technical analyses of relevant markets to determine the portfolios’ country/ sector allocation, duration and yield curve strategy, as well as currency positioning.
Portfolio construction
Combining both top-down and bottom-up analysis, we construct portfolios that reflect the team’s duration/yield curve, sector, credit and currency risk preferences within the permitted risk parameters.
Risk control & Review
We review portfolio risk exposures on an ongoing basis, with portfolio actions discussed with the broader investment team on a regular basis.

ESG

We incorporate ESG issues into our fundamental analysis of companies and assess their impact on an issuer’s financial performance, default risk and bond valuations.
We assess the quality of the company’s corporate governance. We also consider the severity of allegations, reputational risks and a company’s preparedness in dealing with ESG issues.
We determine the materiality of these issues and the appropriate risk premium, leveraging on publicly available information and company interactions.