CSOP Asset Management, the largest renminbi-qualified institutional investor (RQFII) in the world, tripled the size of its U.S. exchange-traded funds lineup Tuesday with the introduction of two new funds, the CSOP MSCI China A International Hedged ETF (NYSE: CNHX) and the CSOP China CSI 300 A-H Dynamic ETF (NYSE: HAHA).
CSOP FTSE China A50 ETF (NYSE:AFTY) in CSOP's U.S. ETF stable. Hong Kong-based CSOP introduced AFTY in March. A Closer Look At HAHA With the ticker HAHA, the CSOP China CSI 300 A-H Dynamic ETF will, at the very least, be easy to remember, but the concept behind this new ETF is no laughing matter. During the run-up in China A-shares stocks and ETFs earlier this year, investors consistently heard that stocks trading in Hong Kong and the ETFs holding those equities were more attractively valued than their mainland counterparts.
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HAHA, which tracks the CSI300 Smart Index, a derivative of the widely followed CSI 300 Index, has the ability to switch to hold the more attractively valued shares class of the dual-listed companies allows the fund to capture potential opportunities brought by price differences between A-share and H-shares, according to CSOP.
The CSOP China CSI 300 A-H Dynamic ETF is a currency-hedged solution for A-shares equities. That new ETF follows the MSCI China A International Index. Notably, it is the stocks in that index that MSCI will add to its international benchmarks when the index provider decides to elevate A-shares.A Look At CNHX
CNHX aims to capture the performance of the investible domestic Chinese equity universe, including large-cap and mid-cap A-Share stocks listed on both the Shanghai Stock Exchange and the Shenzhen Stock Exchange while neutralizing exposure to the fluctuations of the RMB relative to the U.S. dollar, said CSOP in a statement.A Growing Subclass
Prior to Tuesday, there were no currency hedged A-shares ETFs. Now there are two. The Deutsche X-trackers CSI 300 China A-Shares Hedged Equity (NYSE: ASHX) also debuted yesterday.
With the expedited opening steps of Chinas capital market, we maintain a constructive view on Chinas A-shares market and think it is good timing for U.S. investors to increase their holdings of China A-shares, said CSOP portfolio manager Louis Lu in the statement.
CHNX's annual expense ratio is 0.79 percent while HAHA charges 0.75 percent. Earlier this month, AFTY, CSOP's first ETF to trade in New York, saw its expense ratio chopped to 0.7 percent per year from 0.99 percent.
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