New ETF Gives International Investors Exposure to Chinese ‘A Shares’
by Phillip Morton, Investors Offshore.com
30 November 2004

A new exchange traded fund (ETF) has been launched by Barclays Global Investors that will give international investors exposure to Chinese domestic ‘A shares’ for the first time. Such shares are only open to direct investment by Chinese nationals.

The fund, which tracks the movement of the FTSE/Xinhua China A50 Index was launched on the Hong Kong Stock Exchange on November 18 and provides exposure to the top 50 A shares listed on the Shanghai and Shenzhen stock exchanges.

“BGI’s decision to use the A50 Index as the basis of this ETF is another important milestone as it offers all international investors an opportunity to invest in the exciting “A ” share market,” noted Mark Makepeace, Chief Executive of FTSE Group and Chairman of FXI.

Fredy Bush, CEO of Xinhua Finance and Director of FXI, added: “The launch of the A50 China Tracker is of great significance to both Chinese and international investment communities. This, for the first time, provides a path for China A share enterprises to attract foreign funds as well as a unique opportunity for international investors to invest in domestic stocks.”

The launch comes a month after the iShares FTSE/Xinhua China 25 was launched on the London Stock Exchange, the first ETF to allow European investors exposure to Chinese 'red chip' and 'H Shares' listed in Hong Kong.

A comprehensive report describing the investment fund sector in most key offshore jurisdictions, with details of the regulatory structure, is available in the Tax News Reports Shop at http://www.tax-news.com/reportshop/