Fundraising by Chinese private funds plunges, slowing economy takes its toll

An investor sits in front of a board displaying stock information at a brokerage office in Beijing, China December 7, 2018. REUTERS/Thomas Peter

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SHANGHAI, Feb 23 (Reuters) – Funds raised by newly launched private funds in China plunged 44% in January from a month earlier, according to the latest official data, confirming the rapid decline in risk appetite in China. a context of economic slowdown and growing geopolitical tensions. .

The disclosure by the Asset Management Association of China (AMAC) reflects a decline in fundraising by Chinese mutual funds and comes as a growing number of fund managers announce fund launch failures or extend fundraising. subscription periods.

Newly registered private funds totaled 95.9 billion yuan ($15.16 billion) in January, down 44% month-on-month, according to AMAC.

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Of the total, fundraising through products that invest in stocks and bonds fell 49%, while private equity and venture capital fundraising fell 25% and 17%, respectively. , according to the association.

The Chinese stock market has been hit by economic headwinds, regulatory repression in the technology sector and uncertainty stemming from US monetary tightening. The rapidly escalating Russian-Ukrainian crisis will only heighten investor anxiety.

In the area of ​​mutual funds, fundraising fell 61% in January from the previous month and 76% from a year ago, according to fund advisory firm Z-Ben Advisors.

Adding to signs of lukewarm investor demand, three Chinese mutual fund firms failed to launch planned funds in recent weeks, while dozens of others extended subscription periods. Read more

($1 = 6.3260 Chinese yuan renminbi)

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Reporting by Samuel Shen and Andrew Galbraith Editing by Shri Navaratnam

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