Digital brokers help Chinese retail investors go global
China’s investment market is going online, as digital brokers and other investment companies see new opportunities to help mainland investors send their money abroad. China’s huge economy and high savings rate means its investment services market could become one of the world’s largest, but options are limited for savers. One way to diversify is making investments in overseas markets like the US and Hong Kong.
Players old and new are dazzled by a potential user base of millions, but regulators remain tepid. While new regulations last fall encouraged tech and financial firms to go into mutual funds, most of the investment action is happening through brokerage services beyond mainland regulation in Hong Kong.
Bottom line: Digital asset management is a hot field, with a number of already-listed players offering financial services. But these players face real uncertainty about both US and Chinese regulation most are domiciled overseas in an effort to avoid capital controls and limits on trading. As long as China keeps its capital markets mostly closed, the industry is likely to remain in a pretty uncertain position.