News & Insights

Southbound funds compete to be the first batch of fund products under MRF

Alwyn Li was quoted in a Hong Kong Economic Times article discussing the overwhelming response to the mutual fund recognition scheme (MRF) so far.

Alwyn noted the intense competition between southbound funds and explained that Deacons is currently processing more than 10 applications from fund companies that hope to become the first batch of products under mutual fund recognition. Since guaranteed funds no longer exist in the Hong Kong market, it is rare to see more than 10 funds launching at once, except for when the Renminbi Qualified Foreign Institutional Investor (RQFll) programme launched.

Alwyn noted that mainland fund companies would not sell their fund products to Hong Kong all at once due to the high cost. Most applicants are planning to launch 1-2 products, or at most 3-4 products. Stocks, bonds and commingled funds are the main focus, while there is no applications of Index funds and ETFs for now, he said.

Alwyn mentioned that the first batch of applicants are mainly Chinese fund companies and Sino-foreign joint ventures will most likely apply in second round.

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Alwyn Li

Partner | Financial Services

Email or call +852 2825 9627

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