May 20, 2020 / 4:03 AM / 14 days ago

William O'Neil accelerates China expansion amid pandemic, trade tension

(This story corrects to delete reference to Shanghai in second to last paragraph)

SHANGHAI (Reuters) - The U.S. investment advisory firm founded by Wall Street trader William O’Neil is stepping up business expansion in China as Beijing accelerates financial deregulation amid rising tension with Washington.

Undeterred by the pandemic, William O’Neil+Co last month obtained the regulatory go-ahead to launch local-currency funds in China, and will soon apply for a license to raise money locally for offshore investment, CEO Steven Birch said in an interview.

“We see evolutionary parallels between the U.S. and China as young people better understand how to save and build wealth for themselves and their families,” Birch said.

The Los Angeles-headquartered company aims to bring quant-based investment strategies to China’s retail-heavy stock market, where many trade on tips and rumors.

The move comes as China hastens the opening up of its financial industry amid renewed tension with the United States over Beijing’s handling of the coronavirus pandemic.

Birch hailed China’s announcement earlier this month to scrap quotas under QFII, a key inbound investment scheme for foreign institutions.

O’Neil’s bestselling book “How to Make Money in Stocks” is popular among Chinese stock pickers, and the firm plans to launch a series of yuan-denominated private funds that invest in local markets.

The funds’ strategies include O’Neil’s proprietary CAN SLIM stock selection methodology, which seeks to identify stock winners using a blend of fundamental and technical analysis, with factors adapted to trading patterns in China, according to Birch.

William O’Neil will also seek a license under the QDLP outbound investment scheme, with plans to channel Chinese money into its global strategies, Birch said.

The company also owns MarketSmith, a stock research platform used by retail investors, with 30% of its users now from China.

Reporting by Samuel Shen and Andrew Galbraith; Editing by Devika Syamnath

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