KraneShares is set to close its China healthcare and ESG leaders ETFs as the funds struggle to grow assets under management (AUM) since their launch.
In a shareholder notice, the group said the KraneShares MSCI All China Health Care Index UCITS ETF (KURE) and the KraneShares MSCI China ESG Leaders UCITS ETF (KESG) will close on 20 August.
KURE launched in 2018 and has amassed $1.5m AUM since its inception, while KESG launched two years later and houses $2.4m.
KraneShares said the net asset values of the ETFs have fallen “below the minimum amount specified in the prospectus”.
KURE tracks the MSCI China All Shares Health Care 10/40 index which captures 60 large and mid-cap companies in the Chinese healthcare sector.
Meanwhile, KESG tracks the MSCI China ESG Leaders 10/40 index which tracks small and mid-cap companies with a high ESG performance relative to others in the sector.
Both ETFs take into account the 10% and 40% concentration constraints on funds under UCITS rules.
KraneShares recently shut two other China ETFs due to low AUM, the KraneShares MSCI A 50 Connect UCITS ETF (KA50) and the KraneShares Bloomberg China Bond Inclusion UCITS ETF (KBND) on 24 May.
KraneShares joins BlackRock and Invesco in recently closing ETFs, with the Invesco MSCI EMU ESG Universal Screened UCITS ETF (EEMU), the iShares J.P. Morgan € EM Bond UCITS ETF (EB3M) and the iShares FTSE Italia Mid-Small Cap UCITS ETF (IPIR) all closing last week.
