Hedge fund industry in China
Encyclopedia
Hedge fund
s started in PR China in the early 1990s, and has so far undergone four stages: infancy, formation, rapid expansion, and adjustment
and standardization.
s managing pooled property, trust and investment companies' trust and investment projects, and investment companies managing their own capital
. The other is private hedge funds. Under the name of "Investment Consulting Company" or "Investment Management Company", they provide management for pooled property.
economy
, the number of hedge fund investors is increasing rapidly in the country, and the total amount of their wealth is increasing in step. By the end of June 2008, China's residents had RMB 19,460bn ($2,820bn) in bank deposits, of which 80% was in the name of 20% of the population. With such a huge amount of cash
asset
s in hand, the wealthy's strong investment demand has provided hedge funds in China with a sufficient supply of capital. In addition, China's companies also have a huge sum of spare cash, which is also a primary source of capital for hedge funds.
in the USA, 0.35% in Europe, 0.2% in Asia, while only 0.1% in China. It is expected that China's GDP would quadruple in 10 years time and hedge funds would be about 0.4% of the country's GDP. http://www.pr-inside.com/report-on-china-s-hedge-fund-r894061.htm In this case, China's hedge funds would expand 12-fold, and place China second in the world for hedge fund investments.
Year Residential Bank Deposits in China (billion RMB)
Hedge fund
A hedge fund is a private pool of capital actively managed by an investment adviser. Hedge funds are only open for investment to a limited number of accredited or qualified investors who meet criteria set by regulators. These investors can be institutions, such as pension funds, university...
s started in PR China in the early 1990s, and has so far undergone four stages: infancy, formation, rapid expansion, and adjustment
Adjustment
Adjustment means regulating, adapting or settling in a variety of contexts:...
and standardization.
Categories
Currently hedge funds in China fall into two categories. One is those companies backed up by the government, including brokerBroker
A broker is a party that arranges transactions between a buyer and a seller, and gets a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal...
s managing pooled property, trust and investment companies' trust and investment projects, and investment companies managing their own capital
Financial capital
Financial capital can refer to money used by entrepreneurs and businesses to buy what they need to make their products or provide their services or to that sector of the economy based on its operation, i.e. retail, corporate, investment banking, etc....
. The other is private hedge funds. Under the name of "Investment Consulting Company" or "Investment Management Company", they provide management for pooled property.
Economic growth trend
Against the background of China's fast growingEconomic growth
In economics, economic growth is defined as the increasing capacity of the economy to satisfy the wants of goods and services of the members of society. Economic growth is enabled by increases in productivity, which lowers the inputs for a given amount of output. Lowered costs increase demand...
economy
Economy of the People's Republic of China
The People's Republic of China ranks since 2010 as the world's second largest economy after the United States. It has been the world's fastest-growing major economy, with consistent growth rates of around 10% over the past 30 years. China is also the largest exporter and second largest importer of...
, the number of hedge fund investors is increasing rapidly in the country, and the total amount of their wealth is increasing in step. By the end of June 2008, China's residents had RMB 19,460bn ($2,820bn) in bank deposits, of which 80% was in the name of 20% of the population. With such a huge amount of cash
Cash
In common language cash refers to money in the physical form of currency, such as banknotes and coins.In bookkeeping and finance, cash refers to current assets comprising currency or currency equivalents that can be accessed immediately or near-immediately...
asset
Asset
In financial accounting, assets are economic resources. Anything tangible or intangible that is capable of being owned or controlled to produce value and that is held to have positive economic value is considered an asset...
s in hand, the wealthy's strong investment demand has provided hedge funds in China with a sufficient supply of capital. In addition, China's companies also have a huge sum of spare cash, which is also a primary source of capital for hedge funds.
Share of GDP
Data showed that hedge funds account for 0.6% of the GDPGross domestic product
Gross domestic product refers to the market value of all final goods and services produced within a country in a given period. GDP per capita is often considered an indicator of a country's standard of living....
in the USA, 0.35% in Europe, 0.2% in Asia, while only 0.1% in China. It is expected that China's GDP would quadruple in 10 years time and hedge funds would be about 0.4% of the country's GDP. http://www.pr-inside.com/report-on-china-s-hedge-fund-r894061.htm In this case, China's hedge funds would expand 12-fold, and place China second in the world for hedge fund investments.
Bank deposits
Residential Bank Deposits in China 2003-2008H1Year Residential Bank Deposits in China (billion RMB)
- 2003 10,360
- 2004 11,960
- 2005 14,110
- 2006 16,160
- 2007 17,250
- 2008H1 19,460
See also
- Chinese Stock ExchangesChinese Stock ExchangesChinese Stock Exchanges may refer to the two main stock exchanges in mainland China:* Shanghai Stock Exchange* Shenzhen Stock Exchange...
- Commodity trading in ChinaCommodity trading in ChinaCommodity trading in China has a short but high-growth history. With an increasing product variety and deepening liquidity pools, the mainland's futures market is playing an increasingly important role in serving the national economy....
- Banking in ChinaBanking in ChinaChina's banking system has undergone significant changes in the last two decades: banks are now functioning more like banks than before. Nevertheless, China's banking industry has remained in the government's hands even though banks have gained more autonomy...
- Financial services in China
- China Venture Capital AssociationChina Venture Capital AssociationChina Venture Capital Association is a Venture Capital industry trade group that itself says "promotes the interest and the development of venture capital and private equity industry in the Greater China Region."...
- Private equity in China