U.S. Investment Giant(Vanguard) Brings Its Low-Cost Revolution to China

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MFInvestor
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U.S. Investment Giant(Vanguard) Brings Its Low-Cost Revolution to China

Post by MFInvestor » Mon Apr 23, 2018 5:30 pm

U.S. Investment Giant Brings Its Low-Cost Revolution to China

Bloomberg 4/23/2018

https://www.bloomberg.com/news/article ... g-to-china

Vanguard Group amassed $5.2 trillion of client assets and revolutionized the U.S. investment industry by offering low-cost funds to millions of Americans. Now it wants to do something similar in China, even if the strategy takes years to bear fruit.

More than four decades after Vanguard founder Jack Bogle opened the first S&P 500 Index fund, the firm is laying the groundwork for a China expansion made easier by the nation’s opening to foreign asset managers. Vanguard is on track to more than double the size of its Shanghai office this year and may seek approval to sell products to wealthy investors as a first step before seeking a foreign-owned mutual fund license when regulators allow it in 2021, said Charles Lin, the firm’s China head.

“Maybe after 20 or 30 years, we can achieve the same investment and operational efficiency in China like in the U.S., and then our costs would get close to those in the U.S. too,” Lin said. “But that needs the support of a relatively large size.”

Among some of the other China plans that Lin outlined:

Vanguard will probably have both actively and passively-managed funds in China, he said without elaborating.

The firm will set up its own direct-selling platform in China when it can sell mutual funds, and work with local distribution partners, Lin said. While Vanguard typically doesn’t pay commissions to distributors, many in the U.S. sell the firm’s products anyway because clients want them.

davidkw
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Vanguard going to China

Post by davidkw » Mon Apr 23, 2018 6:29 pm

[Thread merged into here, see below. --admin LadyGeek]

Vanguard to China

Vanguard hopes to have an “obvious cost advantage” compared with local competitors, Lin said. It may take time for Vanguard’s index-tracking funds to catch on in China, but he predicted that the appeal of passive investing will grow as the country’s markets become more efficient -- and thus tougher for active managers to outperform.
New CEO is expanding to new markets. Will benefit us all with lower costs
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sunnywindy
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Re: Vanguard going to China

Post by sunnywindy » Mon Apr 23, 2018 6:38 pm

That's great news!
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Re: U.S. Investment Giant(Vanguard) Brings Its Low-Cost Revolution to China

Post by LadyGeek » Mon Apr 23, 2018 7:04 pm

I merged davidkw's post into here. The forum software sorts by time - MFInvestor was first.

FYI - If anyone sees a new thread started, please report the post so it can also be merged into here. You can report the post using the "!" in the top-right corner. One of the reasons is "Duplicate thread". Thanks.

(Thanks to the members who reported the posts.)
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talzara
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Re: U.S. Investment Giant(Vanguard) Brings Its Low-Cost Revolution to China

Post by talzara » Mon Apr 23, 2018 7:13 pm

China still has capital controls. There's a quota on how much money Vanguard can invest in Chinese companies.

I hope this won't count against Vanguard's quota.

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cfs
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Re: U.S. Investment Giant(Vanguard) Brings Its Low-Cost Revolution to China

Post by cfs » Mon Apr 23, 2018 7:28 pm

Already then . . . "Vanguard will probably have both actively and passively-managed funds in China, he said without elaborating." Possible funds Vanguard Total Chinese Market Index, Vanguard Chinese Balanced Index, Vanguard Total Chinese Bond Index, Vanguard Chinese Target Retirement Series, Vanguard Chinese Life Strategy Series, Vanguard Chinese Capital Opportunity, Vanguard Chinese Value, Vanguard Chinese Growth, Vanguard Chinese Primecap, Vanguard Chinese Wellington . . . all aboooooard. Good luck Vanguard's Chinese Adventure, y gracias por leer ~cfs~
~ Member of the Active Retired Force since 2014 ~

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