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How have Chinese ETF managers done abroad?

Over the past four years, some mainland asset managers launched products in New York and London. How have they done?
Shenzhen Wan bridge in the night

Harvest Global Investments in collaboration with partner Deutsche Asset Management has been the most successful among mainland peers in bringing China equity ETFs to developed markets.

Five Chinese fund managers have listed ETF products in Western markets since 2013, all in collaboration with local partners. To date, there have been no actively-managed funds.

In May 2013, Harvest and Deutsche Bank together launched the DB X-Trackers Harvest CSI300 China A ETF on the New York Stock Exchange.

The following year, CSOP in partnership with Powershares, and Harvest with DB, launched one product each in Europe. Later that year, E Fund partnered with ETFS to launch funds in Europe, while the US market saw China AMC partnering with VanEck and Bosera with Kraneshares to launch products on the NYSE.

In the context of mainland managers, the DB X-Trackers Harvest CSI300 Index ETFs have been most successful measured by AUM. They lead the rankings both in the US and in Europe.

In regards to China-based managers, four of a total of 12 ETFs listed in the US or in Europe have exceeded $100m in AUM, which is well above the peer median in developed markets. To put it in a bigger context, the median AUM of all Greater China ETFs in both the US and European markets together is $25.5bn.

The four largest ETFs from China-based managers

Sponsor Fund Trading Venue Launch date Size Benchmark
Harvest DB X-Trackers Harvest CSI300 China A NYSE 11/05/2013 638.9m CSI300
Harvest DB X-Trackers Harvest CSI300 Index Ucits LSE 08/01/2014 392.7m CSI300
Bosera Kraneshares Bosera MSCI China A Share NYSE 03/04/2014 296m MSCI China A
ChinaAMC VanEck Vectors China AMC CSI300 NYSE Arca 10/11/2014 103m CSI300
Data: Morningstar, FE, AUM in US dollars, 31 October 2017

It is still early days for Chinese asset managers and the five firms that have launched products abroad are early movers. In Europe, the marketshare of all Greater China equity ETFs managed by China-based firms is around 19%, according to data from Morningstar. In the US, the marketshare of this group is around 6.7%.

The AUM of all products launched by the Chinese-Western partnerships is around $1.1bn.

Greater China ETFs (which includes China country ETFs) as a category still have low penetration in developed markets. The total AUM in the US is $16.4bn. The European market is smaller, with only $2.3bn of AUM, according to data from Morningstar.



Part of the Mark Allen Group.