INVESTING/PORTFOLIO STRATEGIES

PanAgora, China Asset Management forge strategic relationship to bring risk parity to China

PanAgora Asset Management, the Boston-based quant firm, and Beijing-based China Asset Management Co., one of China’s biggest fund management companies, have forged a strategic relationship to offer risk-parity strategies to investors on the mainland, PanAgora announced Thursday.

China Asset Management will incorporate research and investment strategies developed by PanAgora into a suite of Chinese risk-parity offerings for institutional and retail investors in China.

“We believe now is the right time that Chinese investors can benefit from the risk-parity approach in multiassets investing, one obvious benefit being better diversification,” said Jesse Huang, director, strategic relations at PanAgora, in an e-mail. “We also believe that the macroeconomic backdrop in China, based on past experiences of countries like Japan, U.S. or Europe, is good for risk-parity multiasset approach there.”

A news release said China Asset Management’s initial offering will be a Chinese risk parity multiasset strategy, but the two firms will work together to develop additional strategies in the near future.

Hongtao Zhang, executive officer of China Asset Management’s quantitative investment department, said in the release that the collaborative relationship will offer investors in China “better diversification using strategies not currently available to Chinese investors.”