CreditEase suggests investment in fund of funds
- By Chen Boyuan
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E-mail China.org.cn, June 26, 2017
CreditEase, a leading Chinese inclusive finance and wealth management company, suggested on June 24 that investing in a fund of funds (FOF) would be the most reliable way of increasing one’s capital.
![Tang Ning, founder and CEO of CreditEase, delivers a keynote speech on June 24, 2017, at the First Capital Market Forum held by the company in Beijing. [Photo by Chen Boyuan / China.org.cn]](http://images.china.cn/attachement/jpg/site1007/20170626/b8aeed990a581abadcc808.JPG "Tang Ning, founder and CEO of CreditEase, delivers a keynote speech on June 24, 2017, at the First Capital Market Forum held by the company in Beijing. [Photo by Chen Boyuan / China.org.cn]") |
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Tang Ning, founder and CEO of CreditEase, delivers a keynote speech on June 24, 2017, at the First Capital Market Forum held by the company in Beijing. [Photo by Chen Boyuan / China.org.cn] |
"The most reasonable way to invest the capital market is to do that through a multi-strategy FOF – a fund that invests several elite fund management companies," said Tang Ning, founder and CEO of CreditEase, speaking at the company's First Capital Market Forum held in Beijing.
The reason, he explained, was that each fund management company had "its own way of making profits, as well as its different strategy to coping with risk." More importantly, a multi-strategy FOF, by investing in several good-standing fund management companies, would naturally tend to maximize returns and minimize risk.
"A stock market crash may be a 'torrent' to long stock investment strategies, but only a 'drizzle' to short stock ones; in fact, it may even be 'sunshine' to short strategies of synthetic futures," said Tang. "In other words, the world of multi-strategy FOF doesn't have to face extreme weather."
CreditEase warned potential investors off short-term speculation in capital markets. It expressed full confidence to China's future capital market structure, but declined to presume how the two major stock markets of the country would move in short term.
This also amounted to an explanation why CreditEase recently prolonged the lockdown period for some financial products to three years – from the initial one year.
"Three years is, nonetheless, a short time for capital market investment. However, in the three-year lockdown period, investors don't have to worry about market fluctuations, including sudden and drastic falls, which in the eyes of our professional are quite normal," said Tang.
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