Hong Kong

First RQFII A-share ETF debuts at HKEx

The first RMB Qualified Foreign Institutional Investor A-share exchange-traded fund has been listed on The Stock Exchange of Hong Kong.

The first RMB Qualified Foreign Institutional Investor A-share exchange-traded fund has been listed on The Stock Exchange of Hong Kong.

China Asset Management (Hong Kong)’s (RQFII A-share ETF is a RMB-denominated physical A-share ETF.

Through the RQFII investment quota granted by Mainland authorities, an RQFII A-share ETF seeks to track the performance of an A-share index by investing RMB raised outside Mainland China directly in a portfolio of A shares.

The ChinaAMC CSI 300 Index ETF will be the first physical ETF outside the Mainland market to invest directly in A-shares and the first A-share ETF outside the Mainland to trade in RMB.  Besides this ETF, there are 24 other ETFs on A-share indices listed on the Exchange, but they adopt synthetic replication and are traded in Hong Kong dollars.

The listing of this ETF on the Exchange will increase its total number of listed ETFs to 93 and the number of ETF managers to 16.

The first RMB product type to list on the Exchange was debt securities in October 2010, followed by a real estate investment trust listing in April 2011. With this listing, there are 33 debt securities, two ETFs (including this ETF), and one Reit available for trading in RMB on the Exchange.

Hong Kong's ETF market had the second highest turnover value in Asia Pacific in the first half of 2012 based on statistics published by the World Federation of Exchanges.

"We are pleased to facilitate the admission to trading of RQFII A-share ETFs on the Exchange," says Calvin Tai, head of trading at Hong Kong Exchanges and Clearing.  "This is an important development to further strengthen HKEx's position as a leading international market to trade RMB products by offering more direct access for Hong Kong and international investors to gain exposure to the Mainland A-share market."

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