Deutsche Bank’s ETF platform, DB X-trackers, has listed its DB X-trackers CSI 300 Index ETF (XCHA) on the London Stock Exchange, making it Europe’s largest China A-shares ETF by assets under management.
The CSI 300 Index tracks the performance of the 300 most representative – as measured by a combination of market capitalisation and liquidity – A-shares listed on the Shanghai and Shenzhen stock exchanges.
A-shares are quoted in Chinese renminbi and have traditionally been difficult for investors outside of China to access – international investors must be the holder of a QFII (qualified foreign institutional investor) licence in order to get permission to trade in China’s A-share market.
While international investors can freely access H-shares and red-chip stocks (Mainland China-based companies incorporated and listed in Hong Kong), A-shares make up over 75% of Chinese market capitalisation, covering more than 2000 companies across all sectors of the Chinese economy.
“The China Securities Regulatory Commission is expanding its quotas for foreign investment, signalling a willingness by the Chinese government to open up China’s capital markets further to international investors. But for many investors it remains a difficult market to access. The DB X-trackers CSI 300 Index ETF can bridge that gap,” said Manooj Mistry, head of DB X-trackers for the UK.
The DB X-trackers CSI 300 Index ETF currently has around £220 million in assets under management. Share classes for the ETF are currently listed on the Hong Kong and Singapore stock exchanges. The London listing represents a new, additional share class.
The new listing is the latest addition to DB X-trackers’ suite of emerging markets ETFs, which now numbers over 50. These funds provide exposure to broad emerging markets as well as a number of individual emerging market countries, including India, Brazil, Russia and Indonesia, among others.
Other DB X-trackers emerging markets offerings include a full range of emerging markets industry sector ETFs, some of which provide exposure to specific Chinese sectors – such as the energy or utilities sectors, for example – while others provide exposure to industry sectors across the spectrum of emerging markets countries.
DB X-trackers’ emerging markets range also includes ETFs that provide exposure to high-dividend emerging markets stocks, such as the DB X-trackers MSCI AC Asia ex Japan High Dividend Yield Index ETF (XAHG), and an ETF that provides exposure to ‘frontier’ markets – the DB X-trackers S&P Select Frontier ETF (XSFR).