Vanguard will shift gears in the mainland China market, marking a rare case of a foreign entrant reeling back from greater exposure in the newly opened financial market in mainland China.
The U.S. passive investment giant Vanguard will instead focus on developing its robo-advisor joint venture with Ant Group, according to a statement.
Originally hired to head the licensed funds business, ex-Da Cheung Fund Management CEO Luo Dengpan will lead the remaining Shanghai-based team to also focus on the joint venture.
The license retreat from the estimated $3.2 trillion mutual fund market follows other withdrawals in the region including its exit of Hong Kong and Japan as well as the return of $21 billion of assets to China’s sovereign investors.
«Bang Ni Tou»
The joint venture launched its robo-advisor service «Bang Ni Tou» – literally translated to ‘help you invest’ – targeting clients with at least 800 yuan in investable assets. Based on risk appetite and investment horizon, portfolios from 6,000 mutual funds are recommended to users.
According to Vanguard, more than half a million Chinese investors have already signed up in the first year.
Globally, Vanguard is the second-largest money manager with more than $7 trillion in assets under management.
