Two newly launched Chinese exchange-traded funds (ETFs) have drawn substantial investments from global institutions, including the UK’s Barclays (LON:) Bank and Switzerland’s UBS, despite the slow economic recovery and a stagnant local equities market in China. The ETFs, ChinaAMC CSI Hong Kong Connect Mainland Financials ETF and Bosera SSE (LON:) STAR Market 100 ETF were launched by China Asset Management on the Shanghai Stock Exchange on Friday.
The ChinaAMC CSI Hong Kong Connect Mainland Financials ETF initially raised Rmb209mn ($28.6mn), with UBS and Barclays emerging as the second and joint third-largest investors respectively. This fund is part of China Asset Management’s efforts to tap into the potential of mainland financial companies that are accessible through the Hong Kong Stock Connect.
In addition to the ChinaAMC CSI Hong Kong Connect Mainland Financials ETF, the Bosera SSE STAR Market 100 ETF also attracted significant attention. This fund is one of four tech-focused funds tracking the STAR Market 100 Index, which collectively secured Rmb6.9bn. The interest in these funds indicates a sustained global institutional interest in Chinese assets.
These investments come as China continues to grapple with a slow economic recovery and a stagnant local equities market. Despite these challenges, global institutions like Barclays and UBS are demonstrating their confidence in Chinese assets, suggesting potential growth opportunities in the region.
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