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ICBC AM enters ETF arena with partner CSOP

ICBC AM has partnered with CSOP Asset Management to advise on ETF development and distribution.

ICBC CSOP S&P New China Sectors ETF has been renamed from CSOP S&P New China Sectors ETF to mark the partnership between ICBC AM and CSOP, the firms said in a joint statement.

The fund, launched December last year, features China’s “new economy” companies, mainly focused on consumer consumption. AUM of the fund is HK$225.1m ($28.83m) as of the end of October this year.

ICBC AM will provide investment advisory and support portfolio management for the China-focused fund. Other than advisory on A-shares, ICBC AM will also assist in the distribution of this fund.

Melody He, head of ETF and index solutions at CSOP, said the partnership aims to take advantage of the planned ETF Connect, although regulators have not given any timeline for launch of the programme.

“As ICBC AM understands the Chinese market well, the firm could offer some advice on product design within the partnership,” she added.

However, the partners are only exploring “preliminary ideas” on new product development, according to He.

Prior to this partnership, ICBC AM did not manage any ETFs but it manages six SFC-registered funds in the SAR with total assets of $27.1m, according to FE.

ICBC AM in October revealed bold plans to grow internationally through partnerships with Blackrock and Goldman Sachs AM.

CSOP manages $5.2bn of assets as of the end of October this year. Among its 20 SFC-registered funds, 16 of them are ETFs, tracking indices of listed companies in China, Hong Kong, and India.

However, the firm also launched an ETF in London in 2014 in partnership with UK’s Source. It follows the FTSE China A50.

CSOP also has three ETFs domiciled in the US, the China CSI 300 A-H Dynamic ETF, the FTSE China A50 ETF and the MSCI China A International Hedged ETF, according to Morningstar data.

In this week’s head-to-head feature, FSA analyses seven ETFs that all follow the same China index.

Part of the Mark Allen Group.