Affin Hwang AM's China Tracker Fund ETF lists on Bursa

Affin Hwang AM managing director Teng Chee Wai said:

KUALA LUMPUR: Affin Hwang Asset Management Bhd's (Affin Hwang AM) TradePlus S&P New China Tracker was listed on the Main Market of Bursa Malaysia on Monday.

The exchange-traded fund (ETF) was the first Malaysian-listed ETF to be listed in dual currencies, which were in ringgit and US dollar.
At midday, the China ETF-ringgit, was up nine sen to RM5.37. There were 54,200 units done. However, the China ETF-US$ was not traded at its offer price of US$1.275.

The equity ETF provides investors exposure to China’s new economy and to participate in positive growth trends and consumption patterns within its changing economic structure, as it transitions from an investment-driven to a consumption & services-led economy. 

“Benchmarked against the S&P New China Sectors Ex A-Shares Index, the fund will employ a full replication strategy to closely track the performance of the index, providing an efficient manner for investors to gain broad exposure to Chinese listed companies in its fast-growing consumption and service-oriented industries,” it said. 

Affin Hwang AM said the fund will invest a minimum of 70% of the net asset value (NAV) in authorised securities(, with an option to invest a maximum of 20% of the fund’s NAV in derivatives and/or collective investment schemes. The remaining balance shall be invested in money market instruments and/or deposits for liquidity.

Its managing director Teng Chee Wai said since the listing of its first ETF (TradePlus Shariah Gold Tracker) on Bursa in 2017, this ETF would enhance its overall product suite and bolster our position in the passive investment space as a full-fledged asset management player.”

He said local investors would be able to take part  in one of the biggest investment themes globally as China shifts from an investment-driven economy that was centred primarily on infrastructure & manufacturing to a more knowledge-driven economy that is focused on research & development (R&D) and innovation.

On the market outlook for China, he said: “We’ve seen some softness in Chinese data that shows its manufacturing sector experiencing some slowdown as a result of the trade conflict. Though, recent stimulus measures announced by Beijing to prop-up growth and cushion the impact from its ongoing trade spat with the US has provided some reprieve for markets and inject liquidity. 

“However, with a larger pain threshold and a more resilient economy today, we don’t see China reverting back to more aggressive stimulus measures to drive growth like its credit-fuelled binge in the past.” 

“Over the long-term, as China presses on with its economic restructuring and deleveraging exercise to rein-in credit risk, we see positive structural trends that would bode well for China. 

“Its services and consumption sector now constitute more than 60% of contribution to GDP growth and is expected to increase exponentially with rising income levels and rapid urbanisation in the country. As China continues to harness these strengths, we see opportunities emerging from the New China and the various sectors riding on these positive consumption trends,” Teng said.

Investors can buy and sell units throughout the trading day like any other publicly-traded shares, with a minimum board lot size of 100 units. The fund was launched at an initial issue price of HK$10 per unit. 

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