Greetings from Beijing! I wanted to send this note to all of you who live and work outside of mainland China. We are together during our fight against the world spread virus. I have taken quite some comfort from the fact that markets like Hong Kong, Singapore and Israel have done a very good job containing the virus. As the Trump administration declared a national emergency, I hope the US situation will soon stabilize. Please take very good care of yourselves and your beloved ones. Do not hesitate to reach out to HR and your business division leadership for help, if there is anything that we can do.
In the meanwhile, I’d like to share with you some of my thoughts about the virus situation. First of all, all the peoples and nations are under one roof and shall fight together as a team, not individually. Just a few weeks ago donations came to China from all over the world, and these days China is dispatching medical experts to assist in other countries’ anti-virus efforts. I was struck that the 84 years old Professor Nanshan Zhong, while still saving lives in Guangdong, was on the video call with his counterparts in the European Union to share his rich experiences. I am confident that, with great teamwork, the human race can overcome its current challenge.
Secondly, now it’s time to consider investing more proactively, as the markets are down substantially from their peaks. While they may go down further, we learn from the history that investment returns are actually better during economic downturn. That’s because entry valuation will become much more attractive and we will have more time evaluating an opportunity, when the market is not that hot. As Warren Buffet puts it, he’s ready to invest hungrily once there is panic. We should do the same.
Thirdly, alternative investment is becoming mainstream around the world, no longer “alternative”. Our worldwide offices invest in private equity, private debt, real estate funds and hedge funds, representing one of the best growth opportunities in the global asset management industry. Early this month, the highly reputable consulting firm Preqin published an important research report highlighting that these alternative asset classes are taking more and more share of global asset owners’ allocation strategy. The firm found that over 77% of investors will maintain or increase their exposure to alternatives in 2020. That percentage will go up further to 81% in the future years. Within the space, private equity is the biggest beneficiary and 86% of investors will maintain or increase their private equity allocation in 2020. I believe all this great tailwind and great momentum will keep us very busy throughout the year and in the years ahead.
Being truly global is CreditEase’s key strength, which benefits our clients tremendously and sets us apart from the crowd. Thank you all very much for what you do for our clients during this turbulent time. Please continue to take good care and be safe. Let’s stay very close together, via WeChat and Zoom!