Chinese investors eyeing Europe

Funds marketing

For European companies and institutions, marketing is essential in Asia, said Ching Yng Choi, head of the Asia Representative Office with the Association of the Luxembourg Fund Industry.

There are no uniform standards for strategy and it is not easy to expand distribution channels when knowledge about the market is limited. It is vital to establish connections to distribute products, said Choi.

In Asia, individual investors tend to choose cash deposits instead of investing in funds. Even if they invest, most want to try their luck in the stock market instead of choosing long-term investment products.

These days investors are interested in other options, said Choi. Specialized investment funds are enjoying a great performance despite being subjected to regulations that limit investment and private ventures are also popular.

European countries are making great efforts to market the Undertakings for Collective Investment in Transferable Securities to buyers in China, one of several countries with a great potential to buy. UCITS are a set of European Union directives that aim to allow collective investment schemes to operate freely throughout the EU on the basis of a single authorization from one member state. Critics say that in practice many EU member nations have imposed additional regulatory requirements that have obstructed their free operation to protect local asset managers.

As the European economy struggles to recover, the net sales of UCITS in 2012 reached 201 billion euros while inflows across Europe returned to positive territory on the back of strong demand, according to statistics compiled by the European Fund and Asset Management Association.

Long-term UCITS also returned to positive territory, registering net inflows of 239 billion euros compared with outflows of 64 billion euros ($82 billion) in 2011.

By the end of the year, total investment fund assets accounted for 62 percent of the EU's GDP, while total investment trust assets increased 12.4 percent to 8,944 billion euros.