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Asia ETF Roundup (Industry) – August 2018

MSCI A-share inclusion completes 2nd stage – 236 A-shares at 0.75% of EM index; RQFII ETFs experience small estimated net outflows at Rmb 0.2 billion.

Jackie Choy 06/09/18

For economic and market news relating to Asian ETFs, please refer to our “Asia ETF Roundup (Market) –August 2018”.

ETF Industry News

Second Stage of MSCI’s China A-share Inclusion Complete
After the market close on 31 August, MSCI implemented the second stage of China A-shares partial inclusion into its Emerging Markets Index. This concluded the announced MSCI A-share partial inclusion, bringing the inclusion factor to 5%. There are now a total of 236 A-shares (0.75% weighting) in the MSCI Emerging Markets Index.

CSRC Continues to Support A-share Inclusion in Global Indices; To Unify Standards for QFII and RQFII; Hopes to Launch Shanghai-London Stock Connect by End of Year
On August 8, China Securities Regulatory Commission (CSRC) released a summary of its recent meetings. The release highlighted that CSRC would actively support A-share inclusion in FTSE Russell’s global indices as well as the further increase in A-shares’ weighting in the MSCI indices. It also announced its plans to revise rules for the QFII and RQFII regimes with the aim of unifying access standards as well as relaxing access conditions. CSRC would also like to expand the investment scope of offshore capital, although no further details was announced. The summary also mentioned CSRC’s hope to launch Shanghai-London Stock Connect by the end of this year.

RQFII ETF Watch – Net Outflows Totaled Rmb 0.2 billion in August

  • RQFII ETFs recorded estimated net outflows of Rmb 0.2 billion in August (0.5% of beginning AUM), which compares with net outflows of Rmb 1.1 billion in July. This puts YTD estimated net outflows from RQFII ETFs in Hong Kong at Rmb 4.7 billion.
  • The largest A-Share ETF by AUM in Hong Kong, iShares FTSE A50 China Index ETF (02823/82823), recorded an estimated net inflow of Rmb 1.0 billion in August. This follows estimated net inflows of Rmb 1.5 billion in July. August’s inflows further narrows YTD estimated net outflows from this ETF to Rmb 4.6 billion.

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New Launches and Listings

GF International Delists an ETF in Hong Kong
On 23 August, GF International Investment Management announced it would delist the GFI MSCI China A International ETF (03156/83156) from the Stock Exchange of Hong Kong. The fund’s last trading day will be 26 September 2018. The relatively small net asset value (Rmb 20.8 million as of 23 August 2018) and low trading volume of the ETF were cited as reasons behind the delisting.

Premia Partners Lists 2 ETFs in Hong Kong
On 6 August, Premia Partners listed 2 ETFs (09181/03181; 09810/02810) on the Stock Exchange of Hong Kong. These ETFs track the Dow Jones Emerging ASEAN Titans 100 Index, and the Premia FactSet Asia Innovative Technology Index, respectively. The Dow Jones Emerging ASEAN Titans 100 Index selects the largest 100 ASEAN companies based on revenue and net income. The Premia FactSet Asia Innovative Technology Index is an equal-weighted index with 50 constituents from 15 Asian exchanges and HK/China US-listed ADRs with innovative technology characteristics which are filtered by criteria on R&D and revenue growth.

These listings put the total number of ETFs listed in Hong Kong at 192 (126 ETFs, 66 multiple counters, including 22 L&I Products).

Yuanta Delists 2 ETFs in Taiwan
On 7 August, Yuanta Securities Investment Trust delisted an ETF on the Taiwan Stock Exchange owing to the low net asset value during the recent 30 business days. Previously, on 30 July, Yuanta also delisted an ETF out of the same reason. These ETFs are a pair of leveraged/inversed ETFs, listed in June 2017 and tracking the ICE U.S. Treasury 7-10 Year Bond 1X Inverse Index and the ICE U.S. Treasury 7-10 Year Bond 2X Leveraged Index, respectively.

Cathay, Fubon List 4 ETFs in Taiwan
On 3 August, Cathay Securities Investment Trust listed an ETF on the Taiwan Stock Exchange, tracking the FTSE China A 150 Index. On the same day, it listed an ETF on the Taipei Exchange, which tracks the FTSE Chinese Policy Bank Bond 5+ Years Index.

On 15 August, Fubon Asset Management listed 2 ETFs on the Taipei Exchange, tracking the FTSE Chinese Policy Bank Bond 0-1 Year Select Index, and the Bloomberg Barclays US Corporate A3 or Better 9-35 Year 1bn 3% Issuer Capped Index, respectively.

These listings put the total number of ETFs listed in Taiwan at 132.

NH-Amundi, Mirae, Samsung List 5 ETFs in Korea
On 14 August, NH-Amundi Asset Management listed 3 ETFs on the Korea Exchange. These ETFs track the KOSDAQ 150, the KRX 300, and the 2x performance of the F-KOSPI 200, respectively.

On 30 August, Mirae Asset listed an ETF, tracking the S&P 10-Year U.S. Treasury Note Futures(ER) Index.

On 30 August, Samsung Asset Management listed an ETF, which tracks the NASDAQ 100 Index.

These listings put the total number of ETFs listed in Korea at 393.

ChinaAMC Lists an ETF in China
On 16 August, China Asset Management listed an ETF on the Shanghai Stock Exchange, tracking the China Strategic Emerging Industries Component Index.

This listing puts the total number of ETFs listed in China at 180 (54 ETFs on the SZSE, 126 ETFs on the SSE).

Nikko Lists an ETF in Singapore
On 27 August, Nikko Asset Management listed an ETF in the Singapore Stock Exchange, tracking the iBoxx SGD Non-Sovereigns Large Cap Investment Grade Index.

This listing puts the total number of ETFs listed in Singapore at 59.

ICICI Lists an ETF in India

On 30 August, ICICI Prudential Asset Management listed an ETF, which tracks the NIFTY Next 50 Index.

ETFs Launched in August 2018 in the Asia ex-Japan Region

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About Author Jackie Choy

Jackie Choy  

is the director of ETF Research for Morningstar Investment Management Asia