BlackRock lists China A share ETF

BlackRock is seeking to capitalise on the increasing openness of the Chinese market with the listing of its China A-share exchange-traded fund on the London Stock Exchange today.

BlackRock lists China A share ETF


The iShares MSCI China A UCITS ETF gives both institutional and retail investors access to China’s A-share equity market, effective 13 April.

The fund will track the MSCI China A International Index, buying and holding large and mid-cap companies.

Despite the more accommodating nature of the A-shares market seen in the past year, BlackRock cited the restrictions still imposed on the foreign purchase of A-shares as a key factor behind the decision to launch the ETF.

Tom Fekete, head of product for iShares EMEA, said: “Investor interest in China is high and shows no sign of abating. “This fund offers high quality, low-cost exposure to one of the few global equity markets that are truly difficult for international investors to enter.”

BlackRock also revealed a 0.65% total expense ratio, which it said is ’lower than comparable physically replicating China A-share ETFs open to international investors’.

However, the fund launch coincides with a Deutsche Asset & Wealth Management announcement that it is reducing the TER on its own China A-share ETF to 0.65%.

The all-in fee on the db x-trackers Harvest CSI300 Index UCITS ETF (DR) will be dropped from 1.1% per annum on 1 May, 13 months after it launched.

The decision comes following Deutsche AWM acquiring its Renminbi Qualified Foreign Institutional Investor licence in March, and the resulting increased ability to purchase China A-shares.

Marco Montanari, Deutsche AWM head of passive investments, Asia-Pacific, explained: “The success of the db x-trackers-Harvest ETF, in terms of the assets it has raised in a short time, combined with the fact that Deutsche AWM now has additional potential RQFII quota from our German licence becoming available, plus additional capacity stemming from the new Shanghai-Hong Kong Stock Connect system, means conditions are right for reducing the annual all-in fee.”