Global Times | Foreign investors step up research on A-share firms, increase allocations to Chinese assets
As the fourth quarter unfolds, foreign institutions are ramping up on-site research of A-share companies, with more than 1,200 visits recorded so far. Several global investors say improving market returns are sharply boosting international interest in Chinese assets, according to media reports.
Wind data shows that foreign institutions have conducted 1,210 research visits to A-share listed companies so far in the fourth quarter. Point72, often described as Wall Street's "most aggressive money-making machine," carried out 36 visits, while Goldman Sachs, Citi Global, Morgan Stanley and BofA Securities each logged more than 20, according to Shanghai Securities News.
Huaming Equipment drew interest from 92 foreign institutions in the fourth quarter, the most among A-share firms. Shanghai United Imaging Healthcare Co followed with 71 visits, while Hanbell Precise Machinery, Inovance Technology, BeiGene, OPT and Lens Technology each attracted more than 30, according to Shanghai Securities News.
In recent days, several major foreign institutions have said that global appetite for Chinese assets is rising markedly. Wang Zonghao, head of China equity strategy at UBS Investment Bank, noted that foreign institutional investors further increased their holdings of Chinese equities in the third quarter, with underweight levels narrowing from -1.6 percent to -1.3 percent. Unlike in the second quarter, funds with different mandates — global, emerging markets and Asia — all slightly raised their China exposure, according to Shanghai Securities News.
Holdings of Chinese equities among the world's top 40 asset managers also climbed to 1.1 percent, the highest level since the first quarter of 2023. By sector, international investors increased positions most notably in healthcare, insurance, energy, materials and internet companies, the report says.
A fund manager at a Sino-foreign joint venture based in Shanghai said that global investors had long been significantly underweight on Chinese assets — including A-shares, Hong Kong stocks and US-listed Chinese companies — a positioning that was highly inconsistent with the size of China's economy. Since 2024, however, overseas investors have begun to show a clear shift in attitude, with some hedge funds and emerging-market funds actively increasing their allocations as gains in Chinese markets improve, according to Shanghai Securities News.
"More importantly, the continued rise in Chinese assets is prompting many global portfolio managers to adjust their positions," the fund manager said. "To avoid underperforming their benchmarks, such as the MSCI Emerging Markets Index, they are now moving to close out long-standing underweights in China."
Morgan Stanley Investment Management said China's domestic price indices have shown steady month-on-month improvement, a trend that is critical for listed companies' earnings. Overall, the firm expects medium- to long-term profits of A-share companies to rise steadily.
"Against this backdrop, we remain constructive on the market. The core driver of A-shares' medium- to long-term performance lies in the competitive strength of Chinese manufacturing. Supported by multiple favorable factors, this advantage will ultimately be reflected in corporate profitability," the firm said.
Bian Yongzu, a senior researcher at the China Institutes of Contemporary International Relations, told the Global Times on Monday that renewed foreign interest in Chinese assets ultimately reflects confidence in China's long-term economic prospects. At a time when the global outlook is increasingly uncertain, China's solid real-economy foundation and its complete manufacturing system have become critical stabilizers for global industrial and supply chains.
He noted that China's position in global value chains continues to rise, supported by rapid advances in high-tech industries, intellectual property output and research spending. "These strengths are making China an increasingly important anchor for the world economy and a natural destination for long-term global capital," he said.
According to Bian, foreign investors are particularly drawn to sectors where Chinese companies already show strong global competitiveness — from healthcare and energy to new materials and internet industries — as well as fast-growing fields such as AI, new energy and next-generation technologies. These areas, he said, are expected to generate world-leading companies with substantial growth potential.
Bian added that China's capital market still lags behind its economic weight, leaving significant room for expansion. With a vast domestic market, a strong manufacturing base and an increasingly deep innovation ecosystem, "China is positioned to become a major global hub for technological breakthroughs — and that is a core advantage that will continue to attract foreign investment," he said.