Van Eck and China AMC list first ChiNext-linked ETF in US

28 July 2014   Category: News, Asia, China, Global, Hong Kong, USA   By Hui Ching-hoo

China Asset Management (Hong Kong), an offshoot of Mainland asset management giant China AMC, has teamed up with Van Eck Global to launch the Market Vectors ChinaAMC SME-ChiNext ETF – the first US-listed ETF tracking a China A-shares index focussing on SME and ChiNext boards.

Van Eck said that SMEs have become an important driving force for the Chinese economy. The SME and ChiNext boards are important financing channels for Chinese SMEs and represent commitment and support from the Chinese government in regard to developing growing companies, according to the firm.

The launch comes after the two companies formed a partnership earlier this year, in which China Asset Management (Hong Kong) was appointed the sub-investment adviser for Van Eck’s CSI 300 tracking ETF.

Amrita Bagaria, ETF product manager of Van Eck Securities Corporation, previously told Asia Asset Management that many US institutional investors lack understanding when it comes to investing in China, noting that many US investors fail to realise that they are missing huge opportunities when accessing the A-share market.

“From the sales and marketing perspective, we’re very committed to these asset classes,” claimed Ms. Bagaria. “We see A-shares as a long-term opportunity for investors, even though market conditions are pretty challenging right now.”

An increasing number of foreign managers have formed ties with Chinese counterparts when launching A-share-related ETFs overseas. For example, in May 2013, Deutsche Asset & Wealth Management partnered with its sub-adviser, Harvest Global Investments, to list the db x-trackers Harvest CSI 500 China A-shares Small Cap fund in the US.