(Yicai Global) April 25 -- The first funds designed to invest in companies listing on the new Science and Technology Innovation Board in Shanghai will start selling shares from tomorrow.

Seven funds received approval from the China Securities Regulatory Commission this week, a source at one of the funds told Yicai Global. Several will go on sale tomorrow and the remainder on April 29, with each having a CNY1 billion (USD149 million) fundraising cap, he added.

"The limit is meant to speed up establishment of the funds," he said. "A larger limit requires more time to raise cash, and the funds expect to raise CNY1 billion in just one or two days."

The fund managers will need to pour at least 80 percent of their invested assets into technology and innovation stocks, because their names include the phrase 'science and technology innovation.' They will be allowed to diversify into Hong Kong but cannot spend more than half of their invested assets in the special administrative region.

If future funds include 'science and technology innovation board' in their name, they will be expected to invest at least four fifths of their assets in companies listed on the new board.

Spoilt for Choice

The seven fund operators include E Fund Management, Southern Asset Management, China Asset Management, Harvest Fund Management, Fullgoal Fund Management, China Universal Asset Management and ICBC Credit Suisse Asset Management -- the only closed-end fund of the seven.

Many investors have expressed keen interest in their new funds. One of the main reasons is because to invest directly in sci-tech board stocks an individual investor must have a daily average securities account balance of CNY500,000 (USD74,323), one investor in Shenzhen and Shi Bo, chief equities investment officer at Southern Asset Management, told Yicai Global.

The funds offer a range of options for investors, with each planning to invest various amounts of the cash they raise.

E Fund expects to invest 50 percent to 95 percent of its assets, while Southern Asset Management, China Asset Management and Harvest Fund Management put the figure between 60 percent and 95 percent. Flexible fund managers Fullgoal and China Universal will hold between 0 percent and 95 percent, while ICBC Credit Suisse will invest between 60 percent and 100 percent of its cash during the three-year closed period.

Each of the operators plans to put a manager with a long-term focus on emerging tech firms in charge of investors' money. Mao Wei, proposed manager of Southern Asset's new fund, is general manager of its equity research department; and Wang Guizhong, expected manager of Harvest Fund's new fund, currently leads its tech team.

The first batch of funds all have similar investment targets and scope, so industry insiders are recommending investors examine their managers' investment research abilities in the science and tech field when deciding which fund to invest in.

Editor: James Boynton