Issuing CDRs will bring several benefits:
1 can promote the development of the stock market and accelerate the internationalization of China capital market;
2. Broaden investors' investment channels and optimize investment portfolio;
3. Providing convenience for listed companies outside China to raise funds in the Mainland and increasing support for new economic companies will accelerate the transformation of the old and new economic structures and help improve the business and profitability of Chinese banks.
Advantages and disadvantages of extended data CDR fund are:
1, advantages:
(1) unicorn enterprises, mostly in new economic fields such as TMT and new consumer industries, have good prospects.
(2) Strategic placement, with strong certainty and relatively large allocation.
(3) The average P/E ratio in China is higher than that in foreign countries and Hong Kong, so there is room for arbitrage in regression.
2. Disadvantages:
(1) During the three-year lock-up period, the liquidity of funds is affected.
(2) The number of rights issue is uncertain. If the rights issue is small, it may be a drop in the bucket for tens of billions of unicorn funds, and it is difficult to significantly increase the fund's income.
(3) The number of CDRs issued is uncertain. If the number of CDRs issued in a year is small, the fund will rely on credit bonds and ordinary bonds to maintain its income all the year round, and the income will not be too optimistic.
(4) Has the fund manager ever managed such a large scale, experienced the market test, had overseas investment experience and conducted in-depth research on the new economy?
Refer to Baidu Encyclopedia: Chinese Depositary Receipts