Invesco has launched Europe’s first ETF tracking China’s tech-laden ChiNext index.
The Invesco ChiNext 50 UCITS ETF (CN50) is listed on the London Stock Exchange (LSE), Euronext Milan, Deutsche Börse and the SIX Swiss Exchange with a total expense ratio (TER) of 0.49%.
CN50 tracks the ChiNext 50 Capped index which captures the top 50 largest securities listed on the ChiNext market of the Shenzhen Stock Exchange.
The capping limit means that no individual security weight exceeds 8% and the aggregate weight of securities with weights above 4.5% do not exceed 38%. The index is rebalanced quarterly.
Gary Buxton (pictured), head of EMEA and APAC ETFs and indexed strategies at Invesco, said: “Our new ETF offers investors unique access to the long-term growth potential in China, specifically as it relates to innovation driving the transition to a new economy.
“As the ChiNext 50 index celebrates its tenth anniversary in June, this ETF also marks a milestone in the expansion of the index overseas, accelerating the internationalisation of China A-shares.”
The launch comes at a time when China tech ETFs have been among the top performers in recent months after investors reapproached the region on low valuations and strong financials from the likes of Alibaba and Tencent.
However, issuers have been closing their China ETFs following a couple of years of dismal performance.
State Street Global Advisors (SSGA) announced it would close its China government bond ETF as persistent low yields impacted investor demand earlier this month.
