Hang Seng Investment Management has launched a renminbi-denominated share class for Hong Kong’s largest ETF, the HK$110 billion ($14.0bn) Tracker Fund of Hong Kong.
The ETF is the go-to product for low-cost, liquid exposure to Hong Kong’s equity market.
The Tracker Fund, one of Hong Kong’s oldest ETFs, having been established in 1999, is the go-to product for low-cost, liquid exposure to Hong Kong equities.
It is linked to the Hang Seng Index, the foremost barometer of Hong Kong’s stock market performance.
The Hang Seng Index represents the largest and most liquid Greater China companies trading on the Stock Exchange of Hong Kong. Primary and secondary share listings, as well as real estate investment trusts (REITs), are all eligible for inclusion.
Following a recent overhaul in its construction methodology, the index has expanded its number of constituents, enhanced its sector diversification, and embedded new rules aimed at preserving the representation of local firms in an index that had become increasingly dominated by Mainland-domiciled companies.
Listed on the Stock Exchange of Hong Kong, the new RMB counter is available under the ticker 82800 HK while the original, Hong Kong dollar-denominated share class trades under the ticker 2800 HK.
According to Hang Seng IM, the introduction of an RMB counter is aimed at providing yuan-based investors with greater choice and convenience of access.
Hang Seng IM is the Tracker Fund’s new adviser, having overtaken the ETF’s management responsibilities from State Street Global Advisors in Q3 2022. SSGA’s mandate for the ETF was revoked earlier this year following the asset manager’s disastrous handling of sanctions placed on Chinese firms in November 2020 by then-US President Donald Trump.
In addition to the RMB counter, the change in manager has also brought about cost savings for investors – as of 21 September, the ETF’s estimated ongoing charges over a year has been reduced to 0.08%.