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Asia ETF Roundup (Industry) – June 2020

DWS will delist 23 ETFs from the Singapore Exchange. Hong Kong’s offshore and onshore Chinese equity ETFs saw net inflows of USD 0.2 billion and net outflows of USD 0.1 billion, respectively.

Jackie Choy, CFA 09/07/20

For economic and market news relating to Asian ETFs, please refer to our “Asia ETF Roundup (Market) – June 2020”.

ETF Industry News

MSCI Market Classification Review – Argentina, Turkey, Iceland

On 23 June, MSCI announced its market classification review. The firm has launched a consultation on the potential reclassification of Argentina and Turkey from Emerging Markets status to Frontier Markets or Standalone Markets status. MSCI noted that international institutional investors in Argentinean equities continue to be subject to stringent capital controls which were put in place in September 2019. As a result international investors have been unable to access the domestic equity market. For Turkey, MSCI noted that since the introduction of short selling and stock lending bans in October 2019 and February 2020, respectively, the accessibility of the Turkish equity market has been adversely impacted. Iceland, on the other hand, will be reclassified from Standalone Market to Frontier Market status as the country’s capital controls were removed in March 2019.

Chinese Equity ETF Watch – HK-Domiciled Chinese Equity ETFs See Estimated Net Inflows of Nearly USD 0.2 Billion From Offshore Markets and USD 0.1 Billion in Net Outflows From Onshore Markets

  • Hong Kong-domiciled ETFs in the China Equity Category saw estimated net inflows of USD 165 million in June, coming mainly from the Hang Seng China Enterprises Index ETF (02828). On the other hand, ETFs in the China Equity – A-Shares Category saw estimated outflows of USD 100 million, coming mainly from the CSOP FTSE China A50 ETF (02822/82822), the ChinaAMC CSI 300 Index ETF (03188/83188), and the iShares FTSE A50 China Index ETF (02823/82823).
  • For the first half of 2020, Hong Kong-domiciled ETFs in the China Equity Category and the China Equity – A-Shares Category saw estimated outflows of USD 0.7 billion and USD 1.6 billion, respectively.
  • In the U.S. in June, Chinese equity ETFs continued to see larger outflows as compared to the Hong Kong-domiciled ones. Outflows from the iShares China Large-Cap ETF (FXI) and the iShares MSCI China ETF (MCHI) reached an estimated USD 0.5 billion. Meanwhile an estimated USD 36 million was withdrawn from the Xtrackers Harvest CSI 300 China A ETF (ASHR).

New Launches and Listings

5 ETF New Listings in China

  • Chinese ETF providers listed 5 ETFs on the Shanghai Stock Exchange, including 3 broad market ETFs (including an ETF tracking the CAC 40 Index), a strategic-beta sector ETF, and a gold futures ETF.   
  • These listings put the total number of ETFs listed in China at 335 (100 ETFs on the SZSE, 235 ETFs on the SSE).

2 ETF New Listings in Hong Kong

  • CSOP listed a leveraged commodity ETF on the Hong Kong Exchange. The fund offers 2x leverage on the Solactive Gold 1-Day Rolling Futures Index. 
  • Nikko Asset Management listed Hong Kong’s first active equity ETF on the Hong Kong Exchange.
  • Samsung added a USD counter for one of its existing ETFs.
  • These listings put the total number of ETFs listed in Hong Kong at 209 (133 ETFs, 76 multiple counters, including 26 L&I Products).

2 ETF New Listings in Indonesia

  • Indonesia ETF providers listed 2 ETFs on the Indonesia Stock Exchange, including 1 broad market ETF and 1 strategic-beta ETF.
  • These listings put the total number of ETFs listed in Indonesia at 45.

DWS to Delist 23 ETFs in Singapore

  • On 29 June, DWS announced it will delist 23 Xtrackers ETFs currently listed on the Singapore Exchange. The last trading date for these ETFs will be 30 July 2020. The announcement can be found here. After these delistings, Xtrackers will have 5 remaining ETFs listed on the Singapore Exchange.

ETFs Launched in June 2020 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