HSBC Global Asset Management has launched the HSBC MSCI Saudi Arabia 20/35 Capped UCITS ETF on the London Stock Exchange with Further listings planned across key markets in Europe.
The launch is in response to growing client demand for Saudi Arabian securities following MSCI’s decision to include the Kingdom into its emerging markets index, in a two-step process taking place in May and August 2019. The HSBC MSCI Saudi Arabia 20/35 Capped UCITS ETF offers a cost-efficient way to invest in this dynamic inclusion, through the Qualified Foreign Investor (QFI) program1.
The new ETF is designed to replicate2 the performance of the MSCI Saudi Arabia 20/35 Capped Index, which tracks the Saudi Arabia shares included in the MSCI Emerging Markets Index3.
With an estimated ongoing charges figures (OCF) of just 0.50 per cent, the HSBC MSCI Saudi Arabia 20/35 Capped UCITS ETF will provide cost-efficient access to approximately 85 per cent of the free float adjusted market capitalisation of Saudi Arabia equities in one transaction. Dividends will be paid to investors on a quarterly basis.
Olga De Tapia, Head of EMEA ETFs Sales at HSBC Global Asset Management, says: “Saudi Arabia is a market that is increasingly relevant to global investors as it makes further progress in its evolution to becoming an international capital markets hub. The HSBC MSCI Saudi Arabia 20/35 Capped UCITS ETF provides investors with a quick and cost-efficient way to access this significant opportunity.”
Carmen Gonzalez-Calatayud, Director and Senior Product Specialist, ETFs at HSBC Global Asset Management, adds: “The launch is a direct response to increased demand from investors. Our goal, therefore, has been to ensure that the solution we develop is fit for purpose and efficient to implement. Our new ETF provides an excellent building block to future-proof our clients’ portfolios, and can simply be added to existing allocations, meaning there is no need to reallocate.”
HSBC has a longstanding presence in Saudi Arabia and has been offering asset management services in the Kingdom since 2006. It is a leading asset manager in the country, with a team of over 25 professionals based in Riyadh to cover the Saudi market.
HSBC Global Asset Management has been offering passive strategies to its clients for nearly three decades. The business has seen strong demand for single-country passive products given the current market trend for more affordable building blocks. This is in addition to growing demand for efficient entry into markets that can be difficult to access. The launch of the HSBC MSCI Saudi Arabia 20/35 Capped UCITS ETF further expands and complements that offering.