The Investor's Guide to China: Debt

A lot of the financial headlines we’re seeing about China lately involve debt of one form or another. It could be a real estate company that borrowed too much and got into trouble or a new macro policy aiming to rein in leverage in the banking system. But it’s important to differentiate between bad debt and good debt. While companies going bust may be newsworthy, this can also help in reducing so called ‘moral hazard’ if it results in credit risk being priced better by investors. While another positive force is China’s onshore bond market which has nearly doubled in the last five years, and is now the second biggest bond market in the world.

To help explore China's debt markets we are joined by George Efstathopoulos, Multi-Asset Portfolio Manager, and Monica Li, Equities Director. With additional contributions from Olivia He, Portfolio Manager, and Claire Xiao, Credit Analyst.