Fidelity's Anthony Bolton has warned China's property sector faces major headwinds in the second half of 2011.
Bolton, who launched the Fidelity China Special Situations investment trust last year, said the harsh measures taken by the Chinese authorities to curtail growth and tackle inflation would impact the property sector later this year.
According to Reuters, Bolton said: "My view on the China property market is we have had a series of tightening measures, unprecedented in their toughness.
"I think the second half of this year will be very difficult, therefore I am quite happy I have minimal exposure to Chinese developers."
Bolton, speaking at a briefing in Hong Kong, added he is favouring banks listed in Hong Kong within the trust, while he remains underweight financials as a whole.
"Although valuations are attractive, some questions remain. What level of capital will they require in the medium term, that is a question I want to know for many banks," he said.
"Where I am more overweight right now is on the Hong Kong banks, which I think are in a quite different position from the mainland banks."
The trust currently has 25% in financials in total, compared to the MSCI China index benchmark of 37%, at the end of February.
Bolton's major play is consumer stocks, with 23.5% of the trust invested in the sector versus the benchmark of 5.4%.
The trust, which launched a year ago, has assets of £750m.
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