China funds learn painful lessons from defaults

Chinese fund managers are learning painful lessons from the rising incidence of local bond defaults and should put in place credit analysis capabilities or boost their existing teams, say market participants.  At least five mutual funds were affected by the Shanshui Cement default in November, while Shanghai-based Fullgoal has became the first Chinese fund house to sue an issuer to protect its interests. Jeffrey Qi, portfolio manager at E Fund (HK), said: “The Shanshui default e…