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Types of Investment Funds in China

Types of Investment Funds in China

Updated on Sunday 25th September 2016

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Types-of-Investment-Funds-in-China.jpgChina represents at the moment a top economy, which influences the commercial relations established at an international level. Those who want to invest on the Chinese investment market can register similar investment vehicles that are met throughout the world, such as retail funds or hedge funds, which are governed by different investment policies. Our team of lawyers in China can provide an in-depth presentation on the main advantages of each type of investment fund and can help businessmen set up a vehicle that is suitable for their financial status and business plans. 
 

Retail funds in China  

 
The main rule of law which regulates the activity and the incorporation of a retail fund in China is the Securities Investment Funds Law, effective starting with 1st of June 2013. 
 
The main characteristic of a Chinese retail fund is that they are publicly offered to investors who do not have a high level of knowledge in the investment field. They can also be registered as non-publicly offered funds, if the shareholders (not exceeding 200) are qualified investors, as stipulated in the Chapter X of the above mentioned legislation. 
 
Retail funds in China can be registered as open-ended funds or closed-ended funds, which can take the form of: 
 
money market funds;
debt funds;
hybrid funds;
qualified domestic institutional investor funds, which are a special category of funds created by the Chinese authorities, which allow the usage of foreign exchange quotas. 
exchange traded funds. 
 
Investors who want to open a business in China set up as an investment fund should know that the most common type of vehicle is the open-ended fund.
Our law firm in China can offer assistance on how to register an open-ended fund here, which provides no restrictions to the investors. This type of vehicle i is also one of the most popular type of fund in China
 

Hedge funds in China 

 
Under the New Funds Law, hedge funds can be used to register a private fund, able to invest in public securities. The main regulatory framework available in this case is the Administrative Measures for the Master Trust Schemes of Trusted Companies
 
Businessmen who are interested in receiving more details on the types of investment funds available in China are invited to contact our Chinese lawyers
 

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