First China A-shares ETF in Europe under RQFII launched in Ireland

10 January 2014   Category: News, Asia, China, Europe, Ireland   By Asia Asset Management

The Irish Funds Industry Association (IFIA) welcomed the launch of the first exchange traded fund (ETF) to offer European investors access to the China A-shares equity market on January 9.

The Irish-domiciled CSOP Source FTSE China A50 UCITS ETF invests directly into the China A-shares market under the Renminbi Qualified Foreign Institutional Investor (RQFII) quota scheme. This development blends the credibility and widespread use of Irish domiciled UCITS funds with the RQFII quota scheme. In the process it has opened up an exciting opportunity for both retail and institutional investors seeking direct access to one of the worlds’ most important, and untapped, equity markets. A-shares are shares of mainland Chinese companies, traded on mainland Chinese exchanges, and denominated in Chinese renminbi.

Commenting on the launch, Pat Lardner, CEO of the IFIA, said: “This is another significant milestone for the Irish funds industry. It is also a clear demonstration that Ireland and its funds industry remains ahead of the curve of when it comes to enabling investment firms to broaden their distribution reach through innovative, well-structured and efficient products. 

Ireland is already the leading European domicile for ETFs representing approximately 32% of the overall market, servicing over €62 billion (US$84.18 billion) of the €195 billion European ETF market, according to BlackRock’s ETF Landscape 2012.

Ted Hood, CEO of ETF provider Source, added: “Ireland is a natural home for this innovative, new product due to its reputation for regulatory excellence, world-class service levels and expertise in ETFs. Ireland's pre-eminence as a jurisdiction for exchange traded funds has helped support Source's rapid growth from start-up to one of the ETF industry leaders.”