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Fund managers retreat from Chinese stocks


Despite China's economic measures, global fund managers significantly reduced their investments in Chinese stocks in October, marking the third month of over USD3bn in net outflows, Morgan Stanley reports. European funds spearheaded this exodus, leading to the most substantial underweight position on China by foreign long-only managers since 2018. October also saw a notable withdrawal from U.S. funds. Investor wariness persists due to China's shaky economic rebound, underscored by a decline in manufacturing activity. The MSCI China index fell by 4.3%, and the CSI 300 by 3.2%. High-profile stocks like JD.com, Xiaomi, and China Construction Bank faced sell-offs, while Alibaba, Baidu, and AIA received increased investments. In contrast, Goldman Sachs noted a slight uptick in hedge funds' net allocation to China, reaching 8.5% at the month's end.

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