The M&G China Fund’s investment approach will centre on a universe of circa 300 Chinese stocks, which have been curated following more than 30 years of rigorous coverage and investment research. With a strong focus on risk pricing, the team’s high conviction, bottom-up stock picking approach will draw on its extensive knowledge and network of companies and contacts in the region.

Available to UK investors as a daily dealing fund, the M&G China Fund will aim to provide a higher total return (capital growth plus income) net of OCF than that of the MSCI China with 100 per cent China A Share Index over any five-year period. Typically holding between 50 to 80 stocks, it will focus on quality companies with strong balance sheets, sustainable cash flows and attractive valuations.

“In our view, China’s stock market capitalisation is currently disproportionately small compared to the size of its economy, with many stocks trading at compelling levels of valuation. At the same time, many Chinese companies are showing improving operational resilience during recent tough times and are increasingly focused on maximising profits and boosting shareholder returns through both higher dividends and share buy-backs,” David Perrett, manager of the M&G China Fund and co-head of the Asia Pacific equity investment team, said. “In addition to ongoing corporate self-help, many Chinese businesses are also leaders in globally growing areas such as renewable energy and digital supply chain-management."