New Chinese Index’s ETFs Attract Inflows as Funds Leave CSI 300

(Bloomberg) — A cohort of exchange-traded funds tracking China’s new A500 index has seen strong inflows in the two weeks since their launch, showing continued momentum for interest in the new benchmark. 

The group of 10 ETFs has gotten around 30 billion yuan ($4.2 billion) of inflows since trading started this month, sending their combined size to 52 billion yuan. That’s more than twice the amount raised at their inception, with one overseen by Guotai Asset Management growing by more than six times. 

Those inflows came at the same time as cash exited the four largest CSI 300 Index ETFs. It may be a signal that some investors are ready to switch tack as they position in onshore stocks. 

Nearly two dozen A500 feeder products have raised 35 billion yuan so far, according to local media reports. Several fund houses met their fund-raising targets ahead of schedule. Asset managers, seizing on a window of higher risk appetite among equity investors after a recent rally, are making a marketing push.

The CSI A500 Index has gained 14% since its inception on Sept. 23. It’s meant to contain the 500 largest and most liquid firms traded in the mainland, while eliminating those with low environmental, social and governance ratings and which don’t have stock-connect eligibility. The top components by weight are Kweichow Moutai Co., Contemporary Amperex Technology Co. and Ping An Insurance Group Co.

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