China Europe International Exchange welcomes the launch of Europe’s first China smart beta ETF, issued by China Post Global, on its marketplace in Frankfurt, which is a part of the regulated market of the Frankfurt Stock Exchange…..
Danny Dolan, Managing Director of China Post Global
China Post Global is the international asset management arm of China Post Fund, one of the largest asset managers in China that also operates offices in Hong Kong and London. The Market Access STOXX® China A Minimum Variance Index UCITS ETF marks the 15th ETF on CEINEX, further strengthening its lead role as the China financial markets platform in Europe.
The fund aims to replicate the performance of the STOXX® China A 900 Minimum Variance Unconstrained AM index which selects and weights stocks listed on the Shanghai and Shenzhen stock exchanges based on their volatility and how heavily they are traded on exchange, with the aim of reducing overall index volatility.
ETF Name: Market Access STOXX® China A Minimum Variance Index UCITS ETF
Asset Class: Equity Index ETF
Total Expense Ratio: 0.65% p.a.
Distribution Policy: accumulating
Reference Index: STOXX® China A Minimum Variance Unconstrained AM index
The underlying index was developed together with STOXX Ltd. and currently consists of 135 constituents, with the maximum weight per constituent being capped at 8%. The new ETF makes use of China’s Stock Connect programs, which enable equities listed in Shanghai and Shenzhen to be traded internationally via the Hong Kong stock exchange. This avoids trading restrictions associated with the QFII and RQFII quota programs for investing in mainland Chinese stocks.
CHEN Zhiyong, Executive Board Member of CEINEX AG, says “The fact that China Post Global has chosen CEINEX to debut its first China ETF and Europe’s first China smart beta ETF, shows the growing importance of the CEINEX ETF market and further consolidates CEINEX’s market position as the leading European-based marketplace for investing into China. The new product gives European investors the ability to minimize risk while still maintaining the opportunity to realize competitive returns”.
“China has for some time been the primary engine of global growth and there is significant investor demand for China exposure, though in many cases allocations are being held back by concerns about higher volatility,” says Danny Dolan, Managing Director of China Post Global (UK). “The minimum variance approach works to address these volatility concerns while maintaining sufficient liquidity, aiming to give investors access to higher risk-adjusted returns in the medium- and long term. We are very glad to list Europe’s first China A smart beta ETF in Frankfurt, and broaden the choice of China exposures available to European investors.”