The investment advisory joint-venture between Chinese fintech giant Ant Group and Pennsylvania’s Vanguard has already acquired 200,000 clients during its first 100 days of operation.
These 200,000 clients have allocated 2.2 billion yuan (approx. USD$315 million) in funds according to figures from Vanguard, well ahead of its initial expectations.
“The average allocation by the new clients at about $1,575 per investor is higher than we anticipated” said Jim Norris, head of international business at Vanguard, to the Financial Times.
The tie-up between Vanguard and Ant Group seeks to provide more financially inclusive wealth management services to everyday retail investors in China, by making them accessible via both the Alipay and Ant Fortune platforms.
To this end it sets a minimum investment threshold of just 800 yuan (approximately USD$113.00), while advisory services provided by the joint venture cost around 50 basis points a year and guide access to over 6,000 funds made available by Ant Group under its “Bang Ni Tou” (Help You Invest) Scheme.
Vanguard, which has over 30 million clients globally, hopes to leverage Ant Group’s online platforms to bring its low-cost financial advisory services to its Chinese partner’s roughly 900 million users.
“Vanguard plans to provide more materials on Ant’s platform to help educate clients about the importance of investing towards important goals, such as retirement, as opposed to trading or just saving,” said Norris.
The Asset Management Association of China recently reported that assets under management of China’s domestic public funds reached a record high of 17.8 trillion yuan (approx. USD$2.5 trillion) in April for an increase of around a fifth this year.