Nasdaq, Sina Hail Data Deal as Step Towards Globalization of Chinese Investor Portfolios

Users of Sina’s platforms now have access to NLS and GIDS on top of access to real-time US market data from Nasdaq, which the vendor has carried since 2013. Sina makes the data available via its online and mobile portal, and mobile applications, as well as its Weibo social media platform.

Tomas Franczyk, managing director of global information services for Asia-Pacific at Nasdaq, says Sina will feed the data to downstream companies that are launching products and applications.

“There is tremendous attention on technology diversification—particularly in China, where several fintech brokers have emerged and are launching trading products. Nasdaq is working with Sina to power these products and financial applications with NLS and GIDS to make it easier than ever for clients to access the US stock market and take advantage of and invest in any company listed in the US,” Franczyk says.

Li Pai, chief editor at Sina Finance, says that in addition to the existing data deal, there is scope for the parties to collaborate on advertising and marketing initiatives, adding that the vendor is also interested in carrying more of Nasdaq’s data.

Franczyk says Nasdaq is continuously looking for ways to expand beyond its core data products and to create innovative products, and sees China as a huge opportunity for growth.

“We have reinvented our product innovation process and are using machine intelligence and advanced analytics to deliver powerful signals derived from relative strength analysis, Twitter, banking, and investor sentiment data. We are keen to explore these new analytic datasets with partners to actively engage their clients to keep them return for more engagement,” he says.

China’s middle class is expected to grow by 850 million people by 2030. This growing pool of investors are becoming more interested in diversifying their assets and having access to global networks for real-time information.

Li says Chinese investors are diversifying in the domestic market through a combination of domestic equities, bonds, real estate and other investments. Global diversification in overseas stocks, and real estate, among other asset classes, are also becoming more popular because domestic investment opportunities are comparatively narrower and can be highly correlated, making it hard to hedge risk, he adds.

He says the cooperation between Sina and Nasdaq will help investors broaden their horizons and allocate assets globally—and in doing so, increase risk protection.

Li says the existing challenges of diversifying investment portfolios outside of Chinese assets include low diversification and unbalanced combinations of assets, such as low-risk, low-return assets with high-risk assets subject to large fluctuations, as well as administrative barriers, which sometimes result in illiquidity.

Nasdaq is in the process of hiring a new sales executive to be based at its representative office in Beijing to help focus on China and its clients there.

Franczyk says Nasdaq wants to build similar partnerships to the Sina deal in well-established markets like Japan, South Korea, Singapore and Australia. “It’s part of the strategy for the APAC region,” he says.