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Opalesque Exclusive: Greenwoods` Golden China fund races ahead as markets confirm fund`s position on pending convergence of A, B and soon H-shares Greenwoods Asset Management’s Golden China Fund gained 10% net of fees in April 2007, compared with 3.5% gain in the MSCI China Free Index, 4.4% gain in the H-share Index and 30% gain in the Shanghai B-share Index, according to an investor communication obtained by Opalesque.. This is Golden China Fund’s second best monthly performance since inception, thanks to the strong performance in the B-shares on renewed speculation that B-shares will soon be merged into A-shares via either listed companies buying back B-shares and re-issuing A-shares or a direct exchange of B-shares for A-shares.

Greenwoods Asset Management says the firm held this view for quite some time, hence the portfolio is positioned with significant exposure in B-shares, reaping the benefit of this strategic allocation nicely in recent months. While the valuation convergence between A-share and B-share is still ongoing, there is a more important convergence that is happening now which will have greater impact to a much larger Chinese equity universe – that is the convergence between H-shares and A-shares.

(Opalesque Note:

• A Shares - Denominated in Chinese Yuans, A shares are shares on mainland Chinese companies and foreign investors are not allowed to invest in them, hence the next category was invented:
• B Shares -......................

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