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Asia ETF Roundup (Industry) – September 2019

Chinese government bonds included by JPM GBI-EM series while not by FTSE Russell; HK’s offshore and onshore Chinese equity ETFs each see net inflows of USD 0.3 billion

 

Jackie Choy, CFA 10/10/19

For economic and market news relating to Asian ETFs, please refer to our “Asia ETF Roundup (Market) – September 2019”.


ETF Industry News

J.P. Morgan to Include China in the GBI-EM Index Series

On 4 September 2019, JP Morgan announced it will include Chinese government bonds in the GBI-EM index series starting from 28 February 2020. The phased inclusion will track 9 local currency bonds and increases China’s weighting in the series to a maximum cap of 10% during the 10-month period, topping the concentration alongside Brazil.

FTSE Russell Will Not to Add China to Bond Indices

On 26 September 2019, FTSE Russell announced China will not be included in the FTSE Fixed Income indices as part of its annual Fixed Income Country Classification review. The review commended China for making significant progress to improve foreign investor access to the Chinese government bond market. The index provider has kept China on its Watch List for a potential upgrade to Market Accessibility Level 2. The firm stated that index users would like to observe enhancements to secondary market liquidity, increased flexibility in FX execution and settlement of transactions.

Chinese Equity ETF Watch – HK-Domiciled Offshore and Onshore Chinese Equity ETFs Each See Net Inflows of USD 0.3 billion

  • Hong Kong-domiciled ETFs in the China Equity Category saw estimated inflows of USD 0.3 billion in September. Meanwhile, ETFs in the China Equity – A-Shares Category saw estimated inflows of USD 0.3 billion, coming mainly from the ChinaAMC CSI 300 ETF (83188) and the CSOP FTSE China A50 ETF (02822/82822).
  • For the first nine months of 2019, Hong Kong-domiciled ETFs in the China Equity Category saw estimated outflows of USD 0.5 billion, while ETFs in the China Equity – A-Shares Category saw estimated outflows of USD 2.2 billion.
  • In the U.S. in September, we saw an estimated USD 0.1 billion of net inflows from the iShares China Large-Cap ETF (FXI) and the iShares MSCI China ETF (MCHI) and an estimated USD 0.3 billion of net inflows from the Xtrackers Harvest CSI 300 China A ETF (ASHR).

 

New Launches and Listings

 

China AMC, CSOP and Premia Partners Listed 3 ETFs in Hong Kong

 

On 6 and 19 September, China AMC and CSOP Asset Management each listed a 2x inverse product on the Stock Exchange of Hong Kong, respectively. The ETFs track the two times daily inverse performance of the NASDAQ 100 Index.

 

On 24 September, Premia Partners listed an ETF’s accumulating share class of the original distributing share class that tracks the Bloomberg Barclays US Treasury Floating Rate Bond Index.

 

This listing put the total number of ETF listings in Hong Kong at 210 (135 ETFs, 75 multiple counters, including 23 L&I Products).

 

Uni-President, Sino-Pac Listed 4 ETFs in Taiwan

 

On 4 September, Uni-President Asset Management listed an ETF on the Taipei Exchange. The ETF tracks Bloomberg Barclays US Aa-A 10+ Year Senior Index.

 

On 30 September, SinoPac Securities listed 3 ETFs on the Taipei Exchange. These ETF tracks the ICE BofAML 1-3 Year US Treasury Index, ICE BofAML 20+ Year US Treasury Index and STOXX USA 500 Index, respectively.

 

These listings put the total number of ETFs listed in Taiwan at 210, of which 88 of them are bond ETFs.

 

Guotai, Hua An, Zhejiang Zhesheng, Harvest, CCB and Tian Hong Listed 6 ETFs in China

 

On 6 September, Guotai and Hua An Fund Management listed 2 ETFs on the Shanghai Stock Exchange. These ETFs track the CSI All Share Communications Equipment Index and CSI Private-owned Enterprises Growth Index, respectively.

 

On 9 September, Zhejiang Zheshang Securities Asset Management listed an ETF on the Shanghai Stock Exchange. The ETF tracks the CSI Zhejiang Phoenix Action 50 Index.

 

On 19 September, Harvest Fund Management listed an ETF on the Shanghai Stock Exchange. The ETF tracks the CSI 300 Dividend Low Volatility Index.

 

On 23 September, CCB Principal Asset Management listed an ETF on the Shanghai Stock Exchange. The ETF tracks the CSI 300 Dividend Index.

 

On 27 September, Tian Hong Asset Management listed an ETF on the Shenzhen Stock Exchange. The ETF tracks the ChiNext Price Index.

 

These listings put the total number of ETFs listed in China at 233 (64 ETFs on the SZSE, 169 ETFs on the SSE).

 

Hanwha, KB Listed 7 ETFs in South Korea

 

On 5 September, Hanwha Asset Management listed 5 ETFs on the Korea Exchange. These ETFs track the FnGuide KS Quality Tilt TR Index, FnGuide KS Value Tilt TR Index, FnGuide KS LowVol Tilt TR Index, FnGuide KS LowSize Tilt TR Index, FnGuide KS Momentum Tilt TR Index, respectively.

 

On 24 September, KB Asset Management listed 2 ETFs on the Korea Exchange. These ETFs track the one time and daily inverse performance, respectively, of the S&P GSCI Palladium Excess Return Index.

 

These listings put the total number of ETFs listed in South Korea at 444.

ETFs Launched in September 2019 in the Asia ex-Japan Region

About Author Jackie Choy, CFA

Jackie Choy, CFA  

Jackie Choy, CFA is the Director of ETF Research for Morningstar Investment Management Asia