CIC Aims to Boost Canada Resource Bids | Chief Investment Officer

China Investment Corp., the nation's sovereign wealth fund, plans to move its managing director to Canada to boost investment bids for natural resources assets.

(May 22, 2011) — The $332.4 billion China Investment Corp. (CIC), the nation’s sovereign wealth fund, plans to relocate Managing Director Winston Ma to boost Canadian natural resources bids, Bloomberg has reported.

As demands for energy are expected to climb by as much as 40% in the next 20 years as incomes rise in emerging markets and as the global economy rebounds, the move is a sign of Canada’s increasing popularity among global bidders for commodities. Also positioning itself to profit from natural resources assets, the Caisse de Depot et Placement du Quebec plans to invest more heavily in energy and minerals.

According to Bloomberg, Chinese companies have bid $25 billion so far in 2011 for oversees assets to fuel the country’s booming economy. Nick Zeng, chairman of the China Mining Association of Canada, told the news service that Ma’s move will “help CIC to collect more information on the ground from Canada, where natural resources from commodities to water are becoming increasingly popular among global bidders.”

In another sign of the CIC aiming to strengthen a partnership with Canada, the sovereign wealth fund opened its first foreign representative office in Toronto in January. “The Toronto office is aimed at enhancing long-term cooperation with business partners and exploring new areas and opportunities for investment in Canada,” company chairman and chief executive officer Lou Jiwei said in a statement. Felix Chee, chief representative officer in Toronto, said that the new office would further strengthen the fund’s ties with Canada, facilitate potential investment opportunities, and develop a wider network of contacts with business, regulators and government agencies.

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To contact the aiCIO editor of this story: Paula Vasan at <a href='mailto:pvasan@assetinternational.com'>pvasan@assetinternational.com</a>; 646-308-2742

(May 22, 2011) – Ninety-four percent of institutional investors who currently use hedge funds are likely to increase their commitment over the next three years, recent research shows.

According to London-based research firm Preqin, only 7% of institutional investors polled – all of whom currently allocate to hedge funds – have no plans to increase their exposure in the coming years. Thirty percent say they will definitely invest more capital in that timeframe, while 64% say they are considering it.

As for what hedge fund vehicle they are allocating to, the survey shows a general shift toward a direct approach, as opposed to a fund-of-funds one. Thirty-two percent of funds who use fund-of-funds will start to invest directly in the next three years, according to Preqin, while an additional 8% will consider doing so.

The survey also shows a commitment to internal hedge fund resources. According to the firm, 40% of respondents have a hedge fund-specific investment officer on staff, and 50% of this group employs strategy-specific researchers, as opposed to generalists. Twenty percent of investors have expanded their hedge fund teams in the past 12 months; 20% of those who don’t have internal hedge fund teams plan to develop them within the next three years.

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This increase in hedge fund-related resources is echoed in other parts of institutional investing organizations. According to the survey, 39% of investors have increased the size of their general investment teams in the past three years, while 72% of those that have done so have executed the move in the past year. Only 2% of respondents reported a fall in the size of their general investment team in the past three years, and no investors have decreased the size of their hedge fund-specific team in the same period.

To contact the aiCIO editor of this story: Kip McDaniel at <a href='mailto:kmcdaniel@assetinternational.com'>kmcdaniel@assetinternational.com</a>