HONG KONG, Dec 13 Reuters Londonbased quantitative hedge fund Aspect Capital will soon apply to qualify to set up shop in mainland China to establish onshore fundraising and offer its products, two sources familiar with the matter said.

The hedge fund, overseeing more than 8 billion in asset, is preparing to open a Shanghai office and hired two senior staff in October, according to a third source and LinkedIn profile updates.

The move by the computer driven fund giant comes at a time when many foreign investors are retreating from the worlds second largest economy due to increasing economic and geopolitical challenges, and shows some global investors still see potential in China39;s market.

Aspect aims to be registered as a wholly foreignowned enterprise WFOE, which would allow the hedge fund to tap into the increasing demand from China39;s massive investors for alternative assets. They are still in the early stage of the process, said one of the sources.

Aspect Capital declined to comment on its China business plan.

China has been making efforts to lure foreign investment into its capital market, by improving efficiency, and expanding the range of assets and crossborder hedging tools, despite its tensions with the west.

Citadel Securities, one of the world39;s biggest marketmaking firms, last month said the firm is exploring a China licence.

Currently there are approximately 115 foreign financial institutions that have set up WFOEs in China, including Blackrock,…