HSBC Stock – Daiwa launches ETFs under China-Japan connectivity scheme
The two funds, the iFree ETF China G(BA)100 and the iFree ETF China Star50, are the first overseas-listed ETFs to track indices from the respective Shenzhen and Shanghai stock exchanges.
The indices have a particular focus on science and innovation and fast growing tech companies and the newly launched funds are the second batch to be added to the cross-border scheme.
HSBC acted as the custodian for the funds and also processed the listing and the trades, maintaining its prominent role in the new cross-listed ETFs. So far it has acted as the custodian for three of the five participating Japanese asset managers.
The China-Japan scheme was designed to enable international investors to indirectly invest in Chinese assets via feeder ETFs listed on the Tokyo Stock Exchange.
According to Sophia Chung, head of securities services for HSBC in China, the new ETFs mean that “global investors will have easier access to Shanghai’s Nasdaq-style tech board and the Greater Bay Area growth story”.
Chikako Nagahara, head of markets and securities services for HSBC in Japan, said that the connectivity scheme has strengthened Japan’s position as an international financial hub. “We believe that this route will also attract new Japanese investors”.
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