Index provider S&P Dow Jones Indices (S&P DJI) launched the S&P New China Sectors Index on April 13, 2016 and that index has now been licensed to CSOP Asset Management for ETFs.
The Index is designed to provide market participants with exposure to sectors that benefit from China’s transition from an investment-led to a consumer-led economy.
China and Hong Kong domiciled companies are eligible for inclusion in the Index, including A-shares, and offshore listings in Hong Kong, the US, and Singapore. All companies classified within specific GICS sectors and industries related to consumer and service-oriented businesses are included, subject to meeting minimum size and liquidity criteria. The index is weighted by float-adjusted market capitalisation and subject to a single stock cap of 10 per cent applied at each semi-annual rebalance.
“Consumption and service-related industries are becoming structurally more important in China,” says Michael Orzano, Director of Product Management, Global Equity Indices at S&P Dow Jones Indices. “Given the S&P New China Sectors Index only includes companies operating in consumer and service-oriented sectors, this new benchmark will offer investors a unique exposure to the ‘New China’ economy. It also offers a high level of differentiation from existing and widely used Chinese equity benchmarks.”