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Global fund managers shift to benchmark-neutral China weight
The change covers nearly 2,800 global funds and affects $562 billion held in Chinese stocks.
Global fund managers are reducing their retreat from Chinese equities, moving toward a benchmark-neutral position after four years of being underweight, LiveMint Markets, citing Bank of America analysis, reported.
According to the report, active long-only funds among nearly 2,800 global funds analyzed by Bank of America moved to a benchmark-neutral weighting on China starting in June, ending the underweight stance. Collectively, those funds manage $562 billion in Chinese stocks.
The shift is attributed to favorable valuations and growing enthusiasm around artificial intelligence, with fund managers also citing improving profit outlooks in AI-related growth sectors.
The outlet added that while the move may not point to an across-the-board bullish turn, it suggests managers have largely stopped cutting exposure, lowering a key obstacle for any market recovery. Gary Tan of Allspring Global Investments said selling pressure appears to be nearing a floor and that attention is shifting from positioning to earnings delivery.