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Shanghai ETF assets surge by 26% in 2021

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Assets held by mutual funds traded on the Shanghai Stock Exchange soared to a record $ 1.14 billion ($ 180 billion) by the end of 2021, a 26% increase over the previous year, according to data released by the Shanghai Stock Exchange.

The stock exchange also noted that the percentage of retail investors of ETFs alone that earned last year exceeded those who invested in both stocks and ETFs.

The assets held in About 400 ETFs Trading on the Shanghai Stock Exchange represents more than 80% of the total value of the ETF market in China, according to the latest annual report released by the stock exchange.

With the addition of those listed on the Shenzhen Stock Exchange, Chinese ETFs held collective assets of Rmb1.41tn at the end of the year, an increase of 28% from the beginning of 2021.

Shanghai’s ETF market has been the second largest in Asia since taking over Hong Kong nearly a decade ago. It is now trailing just behind the Tokyo Stock Exchange, which held $ 543 billion in ETFs as of the end of 2021, according to Bloomberg data quoted in the report.

This article was previously published by Lights up AsiaDegree owned by the FT Group.

However, in terms of annual turnover, the volume of trading in Shanghai’s ETFs last year exceeded that of all other Asian markets by $ 2.36 billion. Worldwide, it lagged only on the New York Stock Exchange and the NASDAQ, which had a turnover of $ 26.2 billion and $ 8.37 billion, respectively.

According to the new report, there were a total of 5.45 million investment accounts with holdings of ETFs traded in Shanghai as of the end of 2021, an increase of one third compared to last year. Past.

Of these ETF-only investors, more than one in 10 were college-educated women in their thirties living in the rich eastern provinces of Jiangsu or Guangdong, or the Shanghai municipality, according to the report.

More than two-fifths of the 2.1 million ETFs active, or 61.3%, made a profit through their strategies last year. The figure was almost 10 percentage points higher than for those who invest in both Shanghai-traded ETFs and stocks, at 51.5%.

The report also notes that retail ETF investors tended to be relatively long-term investors. They held their ETF units for an average of 71.8 days last year, more than double the time the typical investor in the Shanghai Stock Exchange did in 2020.

The annual turnover of ETFs traded on the Shanghai Stock Exchange amounted to Rmb6.56tn, which in turn accounted for 5.8% of the total trading activity on the Shanghai Stock Exchange.

Market value of ETFs traded on the Shanghai Stock Exchange Got on Rmb1tn first debuted at the end of March last year, after assets soared by almost 60% year-on-year during 2020.

A number of niche ETF strategies were first launched on the stock exchange last year. China’s first three actively managed ETFs were registered in Shanghai on December 10, accumulation Total of Rmb4.5bn in initial funding.

ETFs that track stocks listed on the Shanghai, Shenzhen and Hong Kong stock exchanges also appeared last year. A total of 24 such strategies have completed their listing in Shanghai by the end of 2021, while overseeing combined assets of € 7.2 billion.

The latest report says it will continue to promote product innovation through stock ETFs that “contribute to national strategic interest” – a code for thematic ETFs such as carbon neutrality and semiconductor equity, as well as interbank banking ETFs and ETF options.

The Shanghai Stock Exchange also emphasizes that an agreement was reached at the end of last year between the continent’s stock exchanges and their Hong Kong counterparts on the inclusion of ETFs in the Stock Connect program.

On Wednesday, Hong Kong’s chief financial officer said In his annual budget speech that “the reciprocal approach of ETFs is expected to be implemented soon.”

* Ignites Asia is a news service published by FT Specialist for asset management professionals. It covers everything from new product launches to industry regulations and trends. Trials and subscriptions are available at ignitesasia.com.

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