Italian asset manager Azimut has kick-started its business in Hong Kong and China by setting up a new joint-venture partnership called An Zhong (AZ) Investment Management.
Incorporated in Hong Kong, the JV is 65% owned by Azimut Group and 35% by CMT Holdings, an operation run by a team of investment professionals with local experience.
Having received types 1, 4 and 9 licences from the Securities & Futures Commission, AZ Investment Management’s investment capabilities will extend to Azimut’s existing family of funds, as well as new RMB-denominated assets it is currently designing in Hong Kong.
Through its Hong Kong and Shanghai subsidiaries, Azimut is aiming to complete its offshore and onshore renminbi fund product line and develop a professional investor base in the region.
Massimo Guiati, CIO of Azimut’s Hong Kong operation, notes that his firm’s investment platform is backed by more than 40 Luxemburg domiciled Ucits III funds, already being distributed to professional and retail investors in Europe.
“At the initial stage we will focus locally on approximately 10 of these funds investing in commodities, European equities and European emerging markets as well as a global macro fund,” he tells AsianInvestor.
In addition to its first offshore RMB fund – RMB Opportunities, which was incepted in July – the company plans to launch two more sub-funds investing in investment grade and high-yield CNH bonds respectively in the second half of this year, notes Guiati.
The rationale behind Azimut’s product strategy is to create investment instruments catering to the cash management needs of corporate clients. RMB Opportunities targets European firms with industrial and commercial relationships in China, providing them with RMB-denominated instruments in which to park their currency.
Azimut is applying the same business model in mainland China. Its local business, carried out by AZ Investment Management in Shanghai, focuses on advising Chinese corporate and high-net-worth individuals on asset allocation and risk management.
Based in Shanghai, Gerard DeBenedetto, CEO of the mainland operation, notes that target clients are cash-rich mainland corporates gaining sophistication in investment while trying to mitigate excessive volatility in the A-share market. “We have designed asset allocation funds and fixed-income funds catering to such needs,” he says.
DeBenedetto adds that the company’s primary business is in the onshore RMB securities market, but that it will also direct institutions with a QDII quota to invest in Azimut’s Ucits III funds.
Holding an investment advisory licence in China, AZ Investment Management is seeking cooperation with financial institutions such as fund management companies (FMC), securities firms, banks and trust companies who can manage professional investors’ assets under segregated accounts, collective investment management schemes, wealth management products and trust products.
DeBenedetto says the company is also looking to expand its qualified client base, bringing investors and products to these financial institutions, raising AUM and acting as their investment adviser.