Pictet's global multi-asset fund triples to $5 billion on China inflows

By Summer Zhen

HONG KONG, Sept 15 (Reuters) - A global multi-asset fund managed by Swiss asset manager Pictet has seen its size tripling to more than $5 billion this year, helped by Chinese investors' rush into overseas assets, including alternatives and products offering exposure to AI supply chains.

The growth comes after Beijing tightened scrutiny of offshore investing through unlicensed brokerage accounts earlier this year, bolstering demand for foreign funds sold via legal, cross-border channels.

The Hong Kong-domiciled Pictet Strategic Income Fund has seen its assets under management (AUM) swell to $5.1 billion from $1.6 billion at the beginning of the year, according to the firm. 

About 60% of the fund's AUM came from mainland Chinese retail market through the Mutual Recognition of Funds (MRF) scheme, Freeman Tsang, head of intermediaries for Asia ex-Japan at Pictet Asset Management, told Reuters.

The MRF scheme is a cross-border investment channel as part of which qualified Hong Kong funds are allowed to sell their products on the mainland.

"Deposit yield at home has been coming down, while the AI sector has been performing quite well since the launch of ChatGPT, (and) you have this growth feature emerging globally," Tsang said.

China announced a major crackdown on cross-border investment through "illegal" cross-border securities in May and said the action was aimed at channel outbound investments via legal channels and protect investors.

Qualified Domestic Institutional Investor (QDII) programme is a key channel for Chinese investors to buy overseas assets.

But due to the tighter regulatory quota for the QDII programme, foreign managers are increasingly looking to newer channels such as MRF and Wealth Management Connect to capture strong mainland demand. 

The Pictet Strategic Income Fund led the mainland net inflows via MRF channel for the first half this year among 34 funds tracked by Morningstar, attracting HK$16.3 billion ($2.08 billion).

An August fund newsletter showed its top 10 holdings include U.S. Treasuries and gold, as well as U.S. tech giants Amazon, Alphabet and Nvidia. The fund is up 17% for the first eight months, following a 18% gain in 2025. 

Tsang said he expects MRF to become a mainstream channel like QDII as it strengthens the fund sector ties between Hong Kong and mainland China. Pictet plans to apply for two additional MRF funds, he said.

($1 = 7.8439 Hong Kong dollars)

(Reporting by Summer Zhen; Editing by Sumeet Chatterjee and Lincoln Feast.)