A New Age Dawns for European ETFs With Launch of First ETF Via HANetf’s White-Label Platform …
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Lida Eslami, Head of London ETP Business Development, London Stock Exchange Group
London Stock Exchange
London Stock Exchange
TER: 86 bps
The fund seeks to provide exposure to an index of leading companies driving the growth of online consumption in the developing world.
To be included, companies must derive more than half their profits from Ecommerce or internet activities, including search engines, online retailers, social networks, online video, online gaming, e-payment systems and online travel.
Unlike most emerging market indices the companies included do not need to be listed locally.
This is the first UCITS ETF in Europe to launch via an independent white-label ETF platform and represents a turning point in the history of European ETFs, expanding access to an industry where high barriers to entry have previously limited issuance to large asset managers and banks.
This follows the path of the US ETF industry where asset managers using a white label platform to launch ETFs has become commonplace.
In HANetf, asset managers who aspire to join the European ETF market have a cost effective, scalable and coherent market entry solution. Many aspiring ETF issuers are concerned about perceived high barriers to entry and competing with incumbent industry leaders. HANetf provides a new solution – significantly lowering the barriers to entry and provides scale through aggregation.
U.S managers in particular see Europe as a much more complex set of markets. They are used to a market structure that has one or two exchanges, single settlement & clearing, one currency, one language and one tax system. Europe has multiple exchanges, clearing, settlement, taxes, languages, currencies and other complexities like Brexit and MIFID 2. HANetf navigates all these complexities for the asset manager.
The EMQQ Emerging Markets and Ecommerce UCITS ETF tracks an index of leading internet and Ecommerce providers serving the emerging markets. The index contains over 50 constituents, including Alibaba, Tencent and Baidu, weighted according to a modified market-capitalization methodology with individual constituents capped at 8%. The ETF mirrors a highly successful US listed version of the product that has garnered over $365,000,000 in assets to date. (21/09/18)
The fund lists on London Stock Exchange (Ticker EMQQ ) with a TER of 86 bps. The opening share price of $8.88 was chosen specifically for the triply auspicious connotations in Chinese numerology.
Kevin Carter, CEO of Big Tree Capital, Founder and Chairman of EMQQ Index Committee said: “We are excited to be launching EMQQ in Europe with HANetf. Their experience, knowledge of the market and entrepreneurial spirit make them the ideal partner for us or anyone else looking to enter the European ETF market. We believe that European investors will benefit from gaining pure exposure to the fast growing and innovative Internet companies in Emerging Markets which we believe is the best way to access the growth of the digital consumers in this large and important part of the world.” Hector McNeil, co-Founder and co-CEO at HANetf, said: “The first launch via the HANetf platform is a significant milestone for our team, but also a watershed moment for every asset manager wanting to evolve their European ETF strategy. With this launch, HANetf has single-handedly removed the high barriers to creating and launching ETFs in Europe, opening the gates for more asset managers – traditional, systematic or active – to benefit from the powerful distribution potential of ETFs. With a tremendously successful fund in North America, the EMQQ team have been keen to expand their distribution potential and we are delighted to have worked with them over to bring this proven idea to Europe.
EMQQ is an ideal strategy for our first launch, being highly innovative and unique to the European market. US and Asian managers who haven’t entered the European ETF market are a major target for HANetf. Prior to the advent of HANetf overseas US and Asian ETFs have struggled to enter Europe coherently mainly due to the added complexity of multiple exchanges & settlement systems, languages, currencies, local laws and many other things that don’t exist in their home markets. HANetf greatly improves new ETF issuers chances of success. Add that to a great ETF such as EMQQ this is a great way to launch HANetf onto the European ETF landscape.”
Lida Eslami, Head of London ETP Business Development, London Stock Exchange Group added: “We are delighted to welcome EMQQ Emerging Markets Internet and Ecommerce UCITS ETF, the first ETF in Europe to launch via an independent white-label platform, HANetf. This new ETF adds to the diverse range of funds available on our markets and highlights London as the premier listing and trading venue for ETFs in Europe and a strong funding partner to a sector that is reshaping the global financial services landscape.”