Some veteran Chinese asset managers are freezing subscriptions to their funds, an indication that stocks are too expensive now after a blistering run.
Funds managed by Chen Guangming at Shanghai-based Foresight Fund Management suspended subscriptions for new and existing investors this month. Hedge fund manager Yang Dong at Shanghai Wealspring Asset Management also stopped adding new subscribers for his funds since November 1.
“They may not be able to identify very good investments now after the gains,” said Dai Ming, a fund manager at Huichen Asset Management in Shanghai. “They would rather take a break than accept additional money from investors to buy stocks, probably incurring losses for new subscribers.”
Both Chen and Yang are known for their Midas touch. Chen, renowned for value investing, fetched annualised returns of about 30 per cent during his stint at Orient Securities from 1998 to 2018. He set up Foresight Fund in 2018.
Yang accurately foresaw the two stock bubbles in 2007 and 2015 and the meltdown in renewable-energy stocks in 2021.
