BlackRock is shuffling its China equity portfolio managers in Hong Kong and seeking a new hire following the departure of team head Helen Zhu this month, AsianInvestor can reveal.
Zhu had joined the US funds giant as head of China equities in Hong Kong from Goldman Sachs in April 2014 to replace Ning Jing. She was most recently co-portfolio manager for BlackRock's main $1.53 billion China equity fund, the $19.1 million China flexible equity fund and the China A-shares funds.
A source told AsianInvestor that Zhu is now on gardening leave, but a spokeswoman declined to confirm this. However, she did say that Zhu's last day with BlackRock will be in October. AsianInvestor could not ascertain her next destination
Lucy Liu will become sole manager of the China equity fund on August 1, the spokeswoman said. Liu, previously a research analyst, was added as co-manager of the strategy with Zhu on May 1.
Matt Colvin, lead portfolio manager for the China A-shares funds, will now be sole portfolio manager of those strategies. He will also join Liu as a co-portfolio manager on the China flexible equity fund.
The spokeswoman said a search was under way for an investor to work alongside Colvin and Liu in managing BlackRock's China fundamental active equity solutions. She declined to comment on whether anyone would directly replace Zhu as head of China equities.
Liu joined BlackRock in 2014 and has some 15 years of experience covering Chinese stocks, added the note. She is also a member of the North Asian research team covering communication services, consumer discretionary, consumer staples and telecoms sectors.
Fund research house Morningstar said in a July 15 note on the changes: “Liu will continue to be supported by the 40-member global emerging markets fundamental equities team led by Andrew Swan, and the team-wide flexible investment process brings some continuity. Nonetheless, Liu has had limited portfolio management experience prior to this role.”
That has led Morningstar to retain a neutral rating for the strategy.
The China equity fund's performance has been relatively poor in recent years, according to Citywire data. As of June 30, it had returned 91% over five years (ranking it 19th of 27 among its peers) and 36.8% over three years (33rd of 37), and it had lost 5% over one year (49th of 61).
The strategy has experienced net outflows of $745 million between the start of 2016 and July 24 this year, estimates Morningstar.
Before joining BlackRock in 2014, Zhu had worked for eight years at Goldman Sachs, most recently as chief China equity strategist. Prior to this role, she worked in the bank’s global investment research division as Asia business unit leader for the telecoms and internet sectors, covering China and regional telecoms stocks.
Zhu also worked at ABN Amro for five years in a similar role covering telecoms equity research.
Story updated to clarify the source of comments about Helen Zhu's gardening leave.