Exchange-traded fund assets under management (AUM) tracking FTSE China indices reached over USD20 billion for the first time at the end of July 2014.
FTSE offers a range of products to global and domestic investors in China, most notably the FTSE China 25 Index and FTSE China A50 Index.
These two benchmarks make up the majority of the overall USD21.8 billion, with products such as the CSOP FTSE China A-50 ETF and the iShares FTSE A50 China Index ETF having recently exceeded USD5 billion and USD8 billion AUM respectively.
Currently, more than half of all non-China domiciled global ETF assets are invested in China-linked FTSE benchmarks.
Mark Makepeace, chief executive of FTSE Group, says: “Chinese equities represent an increasingly important part of the global equity investment landscape. We are delighted that market participants are attracted to our established track record in the region, and as China’s markets continue to become more accessible for foreign investors, we will aim to provide further transparent and flexible benchmarks."
Recent FTSE initiatives include the launch of the FTSE Global R/QFII Index Series, a set of benchmarks that provides market participants with the ability to include China A-shares in global indices at a time of their choosing.
China A-shares are not currently included in FTSE’s standard global benchmarks. The region has been on FTSE’s Watch List since 2005 and FTSE’s Country Classification Committee has been able to monitor the gradual and positive market developments with respect to a number of key areas of FTSE’s Quality of Markets Matrix.
A formal review of the status and eligibility of A-shares for FTSE’s China indices will be held as part of the annual country classification review, which takes place every September.