Bringing you live news and features since 2006 

China Flag

Morningstar publishes guide to using ETFs to invest in Chinese equities

RELATED TOPICS​

Morningstar has published a guide outlining the opportunities and risks investors face when accessing Chinese equities through exchange-traded funds.

 
The guide presents a comprehensive overview of global ETFs that offer exposure to Chinese equities, the nuances of investing in Chinese stocks, and the importance of an ETF’s underlying exposure and relevant fundamentals.
 
There are more than 50 country, sector, and strategy indices tracked by approximately 100 Chinese equity ETFs listed on various exchanges outside of China, totalling some USD28bn in assets under management. The report highlights the risks associated with investing in Chinese ETFs, including ETF-specific structural risks, market risks, and currency risk.
 
Additionally, the report highlights considerations regarding taxation and quota-related premiums and discounts for those ETFs investing in China A-Shares, or shares issued by companies incorporated in China that trade on the Shanghai and Shenzhen stock exchanges, that are directly available to domestic Chinese investors, Qualified Foreign Institutional Investors (QFIIs), and Renminbi Qualified Foreign Institutional Investors (RQFIIs).
 
Ben Johnson, director of global passive fund research for Morningstar, says: “Chinese equities are popular among investors in Asia, and Chinese equity ETFs present a vehicle for global investors who would like to tap opportunities in this country, especially as China expands its presence in the global financial markets. In recent years, the Chinese government has become increasingly keen to open its local securities market to the rest of the world. The growing crop of RQFII ETFs provides access to offshore investors looking for exposure to the local A-Share market, and these funds have successfully gathered assets. The expansion of the RQFII programme and the success of RQFII ETFs have created the need for more investor education on these topics.”

Latest News

Morningstar has published a review of the European ETF market for the first quarter 2024, which finds that it gathered..
ETF data consultant ETFGI reports that assets invested in the global ETF industry reached a new record of USD12.71 trillion..
Calastone has published an ETF white paper which examines several of the processes that take place across the lifecycle of..
Adapting product lines to fit into changing methodologies and meet shifting demand is essential to remaining relevant in the industry..

Related Articles

Kristen Mierzwa, FTSE Russell
Index Investments Group (IIG), a division within index provider FTSE Russell, has extended its range of indices through two new...
ETFs
US ETF issuers of active ETFs are facing an increase in fees from the big custodian firms, such as Charles...
Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Konrad Sippel, Solactive
At the end of March, financial index specialist, Solactive, published its 2024 annual report on future trends.  ...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by