Keep knowledgeable with free updates
Merely signal as much as the Alternate traded funds myFT Digest — delivered on to your inbox.
Italian asset supervisor Azimut Group and China Common Asset Administration are teaming as much as launch an trade traded fund that might be listed in Abu Dhabi in addition to a second ETF in Shanghai to offer Chinese language and United Arab Emirates buyers entry to one another’s equities markets.
Azimut Group will launch an ETF on the Abu Dhabi Securities Alternate that may put money into China Common AM’s current Shanghai-listed ETF monitoring the CSI A500 index, Azimut confirmed.
In flip, China Common AM will roll out an ETF to be listed on the Shanghai bourse that may feed right into a separate Abu Dhabi-listed ETF that Azimut plans to launch. It’ll put money into public firms within the pan-Arab area.
Azimut expects to launch the Arab company-tracking ETF by the third quarter in 2025, based mostly on an index that covers giant, liquid shares, the spokesperson advised Ignites Asia.
This text was beforehand revealed by Ignites Europe, a title owned by the FT Group.
The pair of latest ETFs will develop into a part of an ETF join programme between China and the UAE, Azimut mentioned.
China has stepped up monetary co-operation with Center East nations over the previous few years, and has used ETFs as a option to facilitate cross-border capital flows and nearer company ties, because it seeks to strengthen the message of additional opening up its monetary sector.
The Shenzhen Inventory Alternate and Dubai Monetary Market in August signed a memorandum of understanding to advertise cross-border investing in China and the UAE, and discover co-operation in merchandise together with ETFs.
That settlement was adopted by the Shanghai inventory trade, which mentioned earlier in December that it had signed an MOU with the Qatar inventory trade to discover potential co-operation in areas resembling ETFs, knowledge and index merchandise.
The primary two ETFs listed in China that make investments solely in Saudi Arabia’s equities market, launched by Huatai-PineBridge Fund Administration and China Southern Fund Administration, loved strong preliminary demand after they had been listed in July this 12 months.
They feed into CSOP Asset Administration‘s CSOP Saudi Arabia ETF, the first Saudi equities market-focused ETF within the Hong Kong trade, which was launched final 12 months and attracted US$1bn in preliminary funding.
China is quickly increasing ETF tie-ups with different main monetary hubs round Asia.
The Financial Authority of Singapore said final month it was in talks with its Chinese language counterpart to develop the variety of ETFs on a cross-listing scheme linking Singapore and Chinese language exchanges
Introduced in late 2021 to attach ETFs within the Singapore and Shenzhen bourses, the cross-listing programme was expanded in 2023 to cowl the Shanghai trade.
Though solely seven ETFs had been launched within the scheme by the top of November, amid difficulties in reaching business agreements between fund companies and a weak Chinese language market that slowed product pipelines, business contributors anticipated new product launches to choose up in 2025.
Russell Wang, head of securitised merchandise for world markets on the Singapore Alternate, mentioned the expectation of additional authorities reforms and a rebound in China’s onshore markets meant ETF issuers had been now readying extra merchandise for subsequent 12 months.
*Ignites Europe is a information service revealed by FT Specialist for professionals working within the asset administration business. Trials and subscriptions can be found at igniteseurope.com.
