Worries on issuers, high property prices, slowing GDP hit bond ETFs
Print Edition
EXCHANGE-TRADED funds designed to let investors play China’s bond markets, which are mostly closed to foreigners, are facing a slow start amid concerns about Chinese mainland issuers’ credit quality, high property prices and the slowing economy.
At more than US$5 trillion, China’s onshore fixed-income markets are outranked only by the US and Japanese markets and offer attractive rates.
But trading volumes for three Chinese bond ETFs launched in late 2014 have dwindled, and the ETFs are drawing assets at a much slower pace than a Chinese equities ETF run by Deutsche Bank, which since a November 2013 launch has attracted more than US$1 billion in assets.
Analysts predict foreign fixed-income investment on the mainland will grow as China allows more foreign debt ownership. Investors are wary about China’s shaky bond issuers, high real estate valuations and slowing economy.
“If they were launched when there was not a global slowdown, from an economic perspective, it might be a different story,” said Dave Mazza, funds research chief at State Street Global Advisors.
Over the past 12 months, the Standard & Poor’s China Composite Select Bond Index has gained 8.47 percent. So far in 2015, the China index is up 1.9 percent.
Dennis Hudachek, analyst at etf.com in San Francisco, said it may take a while before investors are comfortable with mainland credits, even among investors with holdings in the US$100 billion “dim sum” market of yuan-denominated bonds issued in Hong Kong.
Van Eck’s ChinaAMC China Bond Fund was the first onshore debt ETF, launched in November. It tracks the ChinaBond China High Quality Bond Index of fixed-rate, yuan-denominated debt. Its net assets total US$24.5 million, according to Lipper data.
Trading volumes peaked at 108,000 on November 24, and have since declined more than 90 percent to well under 10,000 shares a day, according to Thomson Reuters.
KraneShares EA Fund China Commercial Paper ETF has about US$22 million in assets, and trades under 1,000 shares a day. The US$48 million Global X GF China Bond ETF, also launched in November, averages volume of 60 shares a day.
By comparison, the Deutsche X-trackers Harvest CSI 300 China A-shares ETF, which debuted in November 2013, averaged 235,000 shares daily in the past month.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 娌狪CP璇侊細娌狪CP澶05050403鍙-1
- |
- 浜掕仈缃戞柊闂讳俊鎭湇鍔¤鍙瘉锛31120180004
- |
- 缃戠粶瑙嗗惉璁稿彲璇侊細0909346
- |
- 骞挎挱鐢佃鑺傜洰鍒朵綔璁稿彲璇侊細娌瓧绗354鍙
- |
- 澧炲肩數淇′笟鍔＄粡钀ヨ鍙瘉锛氭勃B2-20120012
Copyright 漏 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
