HSBC has launched an exchange-traded fund (ETF) investing in mainland-listed Chinese equities, otherwise known as A-shares, on the London Stock Exchange.
Other European listings are planned for the HSBC MSCI China A Inclusion Ucits ETF, which was designed to meet investors' needs in light of the addition, by index compiler MSCI, of A-shares to a widely followed emerging market index.
“As the ETF is designed to track the progressive partial inclusion of China A-shares in the MSCI Emerging Markets Index over time, we believe it provides an excellent building block for investors to future-proof their portfolio using one single share,” said Joseph Molloy, head of index and systematic equity portfolio management, HSBC Global Asset Management.
The physically replicated ETF will track the performance of shares that are accessible through the Stock Connect scheme, which allows foreigners to buy equities listed in Shanghai or Shenzhen via Hong Kong.
On June 1, MSCI added A-shares to the Emerging Markets index with a 2.5% weighting, which will increase to 5% in September.
©2018 funds global asia