Lyxor has announced the launch of a new ETF providing exposure to China domestic shares or A shares, in a bid to expand its emerging markets range.
The Lyxor Ucits ETF MSCI China A tracks the evolution of the MSCI China A Index of stocks listed in Renminbi on the domestic markets of Shanghai and Shenzen, comprising roughly 460 companies.
It will be issued on Euronext Paris and the London Stock Exchange. According to Lyxor, it is the first physical A shares ETF listed in Paris and London. The fund is managed by the Hong Kong subsidiary of Fortune SG, Lyxor’s Chinese joint-venture.
Arnoud Llinas (pictured), Lyxor’s global head of ETF’s and Indexing comments on the launch: “A-Shares represent approximately 75% of China’s total equity market capitalisation. However, until now these stocks have been under-represented in portfolios.”
“In spite of remaining investment constraints linked to the quota system, the pace of regulatory reforms and other initiatives like the Shanghai/Hong Kong Stock Connect program increase the perspective of inclusion and many international investors are already seeking A-Shares investment opportunities. Our new ETF responds to these needs in a flexible and diversified vehicle,” he adds.