Investing in China: North American Public Funds Prefer the Consumer Discretionary Sector

Posted on 01/11/2021

There are many factors driving direct investment into China from North American public funds, which includes public pensions and sovereign wealth funds. Canadian pension funds led the charge in direct investments into China over U.S. public funds and U.S. sovereign wealth funds. Most U.S. public funds prefer fund commitments and smaller co-investments into mainland China versus Canadian pension funds like Canada Pension Plan Investment Board (CPP Investments) and the Ontario Teachers Pension Plan. Direct investments into countries over fund commitments is typically a stronger sign of confidence in the recipient nation.

Direct Investments into China by North American Public Funds – Billions USD

Source: SWFI Global Asset Owner Terminal.
Note: Includes Hong Kong. Excluding fund commitments. Buyer Region: North America. Buyer Types: Sovereign Wealth Fund and Public Pension. Billions USD.

For 2020, North American public funds are favoring the consumer discretionary sector in China over real estate and financials. CPP Investments made a large investment in Alibaba Group Holding Limited, while California Public Employees Retirement System (CalPERS) made a sizeable investment in ZTO Express (Cayman) Inc.

Direct Investments into China by North American Public Funds in 2020 – Billions USD

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