Money Moves

China investments golden for some

by Anna Tong

Darby Liu, executive director and CEO, Core Pacific Group
Photo: Johnny Kwok

The opening up of investment opportunities across mainland China has brought rich rewards to some Hong Kong investors, most of whom only took the plunge after getting the advice of astute and well-informed securities companies.

Core Pacific Yamaichi (CPY), under the Taiwanese company Core Pacific Group, has over 10 years' experience in mainland investing, and has been furnished with awards including FinanceAsia's best small cap initial public offerings (IPOs) house of the year in 2002.

Darby Liu, executive director and CEO of CPY, says, "Currently the Hong Kong market is fluctuating, but we expect the situation to settle down as it is overshadowed by the 2008 Beijing Olympics." Though optimistic about the current market development, Dr Liu foresees problems such as lack of transparency among companies in China creating a bubble that must be monitored with caution. Nevertheless, he regards the general outlook as good with more emerging Chinese companies set to launch IPOs after seeking the guidance of experienced companies such as CPY.

Dr Liu points out that the long-standing peg between the Hong Kong and US currencies means that the health or otherwise of the US economy has a knock-on effect on Hong Kong's economy. If the greenback falls in value, this is reflected in the strength of the Hong Kong dollar. However, he points out that the economic situation in the US has been better than expected, and this is reflected in Hong Kong's robust economy. However, more significant today regarding Hong Kong's financial strength is the economy of Greater China, which is having an increasingly important effect and has now almost reached the same degree of influence as the US.

As part of an initiative to raise CPY's current ranking on the Hong Kong Stock Exchange, the company plans to extend the number of its branches in Hong Kong. It will also broaden its services in wealth management to capture the rising trend in Hong Kong and China of affluent individuals looking for profitable and secure investments.

Innovation plays an important part in the company's strategy to stay ahead in the market, with experienced professionals searching for the most innovative products around the globe to suit client needs. Since Hong Kong investors prefer equity investments involving a short-term but high returns, CPY has devised an innovative bond product that yields higher-than-usual return.

Besides IPO sponsorship, CPY's services range from global equities and derivatives sales trading to research and analysis consultancy. Equity products include equity linked instrument (ELI), hedge funds and commodities, and FOREX futures and options. Dr Liu points out that the company holds a strong position because it helped pioneer investment in the mainland and fully understands the relevant rules and regulations. To leverage on this expertise, CPY aims to seek out more Chinese companies wanting to get listings on the Hong Kong Stock Exchange. "In terms of investment, we hope to expand our fund-raising capabilities by searching out IPOs involving at least one billion Hong Kong dollars," says Dr Liu.

Taken from Career Times 11 May 2007, p. A2
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