10 Insights From Darden’s 2014 Shanghai Investing Summit

1. “The next 10 years for China will spur a transition from quantity to quality as the middle class grows, the demand for consumer and luxury goods rises, and the mobile Internet booms.”
— Liang Xinjun, vice chair and CEO, Fosun Group

2. “China is entering the era of hedge fund industry development.”
— Yifei Li, China chair, Man Group, who remarked that institutional investors are diversifying, family offices and foundations are emerging, and regulations are relaxing ― but still highly complex

3. “Chinese firms are working to form long-term relationships with foreign investors and to create international consortiums to align their interests and enter markets as a group.”
— Fanglu Wang, senior managing director of CITIC Capital, who noted that as Chinese investors increasingly look to invest overseas, they must overcome some skepticism and resistance

4. “Americans tend to see China as a ‘Made in China’ logo. It will help the public perception and the investing perception when more Chinese brands establish themselves in America. Branding is so important for the image of a country.”
— Jim Cheng, principal of New Richmond Ventures, former secretary of commerce and trade for the Commonwealth of Virginia, a 1987 graduate of Darden and a trustee of the Darden School Foundation, who cited an example of Chinese investment in the United States: Shuanghui International Holdings’ recent multi-billion dollar acquisition of Smithfield Foods — the largest acquisition of a U.S. firm by a Chinese company

5. “The momentum in China provides a big investment opportunity for European and U.S. companies.”
— Qian Jiannong, president of tourism and commercial group and senior assistant president of Fosun Group

6. “When Western investors look at China, they use Western models to analyze the Chinese economy. That might not be the right approach.”
— Qing Shan Liu, CEO of Manulife TEDA Fund Management Company, who remarked that investors must understand the complexity and uniqueness of the Chinese market

7. FACT: Applications to join the Asset Management Association of China (AMAC) have surged. Established in June 2012, AMAC is a self-regulatory organization that represents the mutual fund industry of China.

8. “We always look for a market that’s large and deep enough to protect itself from systemic shocks.”
— Peter Chen, head of business development for Asia Pacific, CPPIB Asia Inc., who listed China, India, Australia, Japan, Korea and Southeast Asia as potential pockets of performance

9. “The challenge is to balance global perspective with local expertise.”
— Hua Fan, head of fixed income and absolute return investment department at China Investment Corporation, who underscored the importance of research in the search for opportunity and good value — no matter the industry or region

10. “There are really compelling opportunities in Asia that have scarcity in capital, but there are also a lot of fads.”
— Patrik Edsparr, CIO and co-founder of Tor Investment Management, who encouraged investors to pay close attention to the details and to bring interesting asset classes and real skill to their portfolio selections

These insights were captured from the Darden School of Business Shanghai Investing Summit, held 9 May 2014, in Shanghai, China, and presented by the Darden Center for Asset Management and the Darden Center for Global Initiatives.