Yinhua Fund Management Co. Ltd.
Yinhua Fund Management Co., Ltd. (Yinhua), one of the leading asset managers in China, was founded in 2001 on the belief that experienced investment professionals using disciplined investment process will consistently add value to client assets. Our mission is to be a premier investment advisor, helping investors reach their financial goals by delivering superior and consistent investment performance and providing them with the highest quality investment management services.
Yinhua is headquartered in Shenzhen and maintains offices in Beijing and Shanghai. Yinhua employs about 90 professionals in three offices currently. With over RMB10 billion of assets under management as of June 30, 2005, Yinhua manages assets on behalf of institutional and individual investors through our open-end and closed-end fund products.
Yinhua has four shareholders: Southwest Securities Co., Beijing Capital Group Co., China Southern Securities Co. and Northeast Securities Co..
Yinhua was the first fund management company in China that received the certificate of ISO9001 in December, 2004.
Yinhua was approved eligible for pension investment management business in August, 2005, becoming one of the first nine fund management companies that acquired such qualification.
Investment Objective
We believe that risk-adjusted return is key to investors. Our investment objective is to outperform the benchmarks and generate consistent returns over the long term. We have developed a rigorous and disciplined investment management process, designed to produce consistent performance. Employing a bottom-up research approach to identify undervalued securities, this investment process starts from a proprietary stock screening system through fundamental analysis. At Yinhua, we believe we have created an effective equity research platform through which we identify companies with a business model that gives them a sustainable advantage over their peers.Besides fundamental research, our analytics group also provides quantitative analysis and asset allocation advice to portfolio managers. In addition, a well-established set of trading procedures and disciplines guarantees the best execution of investment strategies.
Over the past few years, we have built a team of 30 investment professionals with capital market expertise in various asset classes. Portfolio managers work closely with quantitative and sector analysts to make the buy and sell decisions and conduct portfolio review and rebalance regularly.
Risk Management
Risk management is the other corner stone of our success.We place a great emphasis on risk management within our portfolios. Over the past few years, Yinhua has developed an effective risk management system through which portfolio risk is targeted to where it is most likely to contribute to active returns. Risk management is incorporated through every step of the investment process to ensure the compliance with portfolio guidelines.
We also introduced Barra Aegis System to our equity risk management, which uses multiple factor risk model to capture the market’s volatilities.
Client Service
At Yinhua, we listen to our clients and we offer a broad array of services to meet their needs, which includes e-mail services through which we distribute fund literature, research reports, corporate publications, etc., periodic conference calls with selected institutional clients, information session under special market conditions for major institutional and individual investors.Additionally, our portfolio managers and research analysts will visit our premier institutional clients regularly to provide more specialized services.
Introduction to corporate pension investment management business
Yinhua was approved eligible for corporate pension investment management business in August 2005, becoming one of the first nine fund management companies that received such qualification in the first eligibility evaluation.
Yinhua has made in-depth and systematic research on corporate pension investment management and finished reports totaled 200 thousand words since June 2003, among which six papers were published on national academic publications such as Operation and Supervision of Corporate Pension and China Securities.
Yinhua successively launched 4 innovative open-end funds during the previous three years. In the design of corporate pension products, Yinhua has effectively developed a series of lifecycle portfolios which includes various risk-return characteristics (lower-risk products account for the most part) in accordance with the guidelines from the program participants. Yinhua will also provide customized corporate pension products and investment services for clients.
Yinhua has set up Institutional Account Management Department, which is responsible for pension investment management operations. 2/3 of the department employees received master’s degrees with average of over 4 years of security investment experience. Most of them participated the Training Programs for Corporate Pension Management sponsored by Ministry of Labor and Social Security. This department will also share the resources provided by our fund investment and research platform.
Yinhua has established sound procedures regarding corporate pension investment management to ensure disciplined operations, effective risk control and ultimate protection of the beneficiaries’ interests.
Our Funds
Tianhua Fund
Yinhua took over Sichuan Government Debt Fund and expanded the original fund to 2.5 billion shares through second offering in August 2001.
Tianhua Fund is a closed-end fund traded through Shenzhen Stock Exchange.The fund seeks long term capital appreciation by investing in companies with high growth potential and staying power.
Yinhua Leading Enterprise Fund
In November 2002, Yinhua launched the first WTO-concept open-end fund, Yinhua Leading Enterprise Fund.
The fund seeks to provide current income and long term capital appreciation. With a focus on valuations, the team utilizes bottom-up research to identify companies with above average revenue and earnings potential.
Yinhua Principal Protection Value Growth Fund
In February 2004, Yinhua developed and issued the first principal guaranteed fund in mainland China—Yinhua Principal Protection Value Growth Fund. The initial offering was a remarkable success, raising over RMB 6 billion within only 10 business days.
The guarantor, Beijing Capital Group provides investors a full protection on the principal at the end of the 3-year guarantee period. The fund offers downside protection while simultaneously participating in the favorable equity market conditions.
Yinhua-Dow Jones China 88 Select Equity Fund
Yinhua launched Yinhua-Dow Jones China 88 Select Equity Fund in August 2004. This is the first enhanced index fund that tracks Dow Jones China 88 Index. The investment objective is to outperform Dow Jones China 88 Index.
The Dow Jones China 88 Index was introduced by global index and financial information provider, Dow Jones & Company in 1996. As the first series of indexes developed by a global index provider for Mainland China’s stock markets, they are designed to give investors worldwide a powerful tool for gauging the performance of China’s domestic equity markets.The fund enables investors to benefit the long-term economic growth in China at low cost through primarily investing in the stocks of the Dow Jones China 88 Index.
To outperform the index, Yinhua could adjust the weightings of the underlying index components and invest in companies with solid market position or better valuation through disciplined substitution strategy. Given various restrictions and deficiencies in the current domestic market, Yinhua considers enhanced index investment strategy a better alternative to plain index investment. Independent researches as well as in-house analysis all prove that through limited active management, the returns could be substantially enhanced while still maintaining a risk profile similar to or even lower than that of the underlying index.
Yinhua Money Market Fund
Yinhua issued Yinhua Money Market Fund in January 2005. The fund seeks as high a level of current income as is consistent with maintaining liquidity and stability of principal.
In pursuit of this goal, the fund invests in a broad range of short term, high quality instruments, including government, bank and corporate obligations.
The fund seeks to maintain a net asset value of 1.00 per share. The weighted average maturity of its investments will be 180 days or less.
Yinhua Money Market Fund introduced different share classes for the first time in the domestic fund market. A shares and B shares accrue different Shareholder Servicing & Distribution expenses based upon the investment amount.
YinHua Core Value Equity Fund
YinHua launched YinHua Core Value Equity Fund in September 2005，The fund seeks to provide long-term capital appreciation by investing in under-valued companies with competitive advantage.
Utilizing bottom-up active equity selection approach, the team will reasonably increase the involvement of equity-picking in investment by quantization attribution analysis of performance. In addition, techniques of portfolio optimization will be used to obtain highest risk-adjust returns. The fund invests at least 60% and as high as 95% of its assets in the most competitive and under-priced listed companies.
YinHua Core Value Equity Fund is the first fund launched through Shanghai Stock Exchange fund express, a fund trading system for brokerage firm to distribute through stock exchange. Awarded ” The prestigious Gold Bull ” in 2005 for marketing innovation.
Yinhua Prime Growth Equity Fund
Yinhua Prime Growth Equity Fund successfully finished its IPO on June 9th,2006.It seeks to achieve long-term superior return by investing in listed companies with “prime” growth prospect and by disciplined risk management.
We believe that, “prime growth” in the performance of a company is the foremost driving force for superior return on its common stocks. Yinhua Prime Growth Equity Fund employs a “triple-phase” security selection procedure of “Fundamentals->Valuation->Expectation” analysis, in order to spot companies which have “prime” growth prospect and are inadequately valued and to achieve superior risk-adjusted return.
Performance
Yinhua has delivered outstanding investment returns to our investors over the past few years. Our flagship fund, Yinhua Leading Enterprise Fund, is one of the top performing equity funds in the domestic market.
Rewards
Ranked “The Most Popular Open-end Fund” in China by sina.com in 2003
Awarded “The Prestigious Gold Bull” in 2004 for the one year performance by China Securities.Only ten open-end funds received this honor. (As of June 30, 2004)
Awarded the best balanced fund on 3-year cumulative dividend, and recommended one of most 15 valuable funds in 2005 by “Science and fortune”,VALUE magazine.
Website: http://www.yhfund.com.cn
Copyright Fund China 2009.
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