FTSE, a leading provider of indices to the exchange-traded funds industry, has revealed that ETF assets linked to FTSE-branded China indices have surpassed the $20 billion mark, hitting $21.8 billion as of July month-end 2014.
ETF assets linked to FTSE China indices surpass $20 billion mark
FTSE offers a range of indices tracking the performance of Chinese securities, but the provider is perhaps best known in the China market for its FTSE China A50 and FTSE China 25 products.
These two indices make up the majority of the provider’s China-linked ETF assets, with funds such as the CSOP FTSE China A-50 ETF (2822) and iShares FTSE A50 China Index ETF(2823) exceeding $5 billion and $8 billion in assets under management respectively, and the iShares China Large-Cap ETF (IXF), referenced to the FTSE China 25 Index, approaching $6 billion.
Currently, more than half of all non-China domiciled global ETF assets are invested in China-linked FTSE indices.
Commenting on the milestone, Mark Makepeace, CEO of FTSE Group, said: “Chinese equities represent an increasingly important part of the global equity investment landscape. We are delighted that market participants are attracted to our established track record in the region, and as China’s markets continue to become more accessible for foreign investors, we will aim to provide further transparent and flexible benchmarks.”
FTSE continues to develop its offering in the increasingly important China space. Recent initiatives include the launch of the FTSE Global R/QFII Index Series, a set of benchmarks that provides market participants with the ability to include China A-shares in global indices at a time of their choosing.
China A-shares are not currently included in FTSE’s standard global benchmarks, but have been on the provider’s ‘Watch List’ since 2005. Countries and regions on the watch list are monitored with respect to a number of key areas of market quality, such as trading environment, regulation, custody and settlement.
The next review of the status and eligibility of A-shares for FTSE’s China indices will be held as part of the annual country classification review, which takes place later this month.
In addition to equity indices, FTSE also offers a suite of China-linked fixed income indices, namely the FTSE-BOCHK Offshore RMB Bond Index Series, launched in collaboration with the Bank of China (Hong Kong).