Mirae Asset launches ESG-China thematic ETFs in Hong Kong
These are the first listed products launched under Hong Kong’s new open-ended fund companies regime
Mirae Asset Global Investments (Hong Kong) Limited has launched three new China and ESG-focused thematic ETFs available to retail and institutional investors in Hong Kong. Launched under the “Global X by Mirae Asset” brand, the “Global X China Consumer Brand ETF”, “Global X China Electric Vehicle ETF” and “Global X China Clean Energy ETF” give investors direct exposure to these respective themes, which are enjoying long-term strong growth and development in China.
The ETFs are the first listed products launched under Hong Kong’s new open-ended fund companies (OFC) regime, which enable investment funds to be established in corporate form in Hong Kong, in addition to the current unit trust form.
With China gaining a leadership position globally in the manufacturing, innovation and deployment of renewable energy technologies, the “Global X China Clean Energy ETF” leads the way in exposure to this theme, becoming the first green/ESG focused ETF listed in Hong Kong.
Units for the three ETFs will begin trading on the Hong Kong Stock Exchange (HKEx) on January 17 in both HK dollars and US dollars.
Amid a shift in focus in China’s economy away from export and manufacturing-driven growth towards consumption and services, the Global X China Consumer Brand ETF features homegrown companies that are benefitting from this transformation and are developing brands that appeal to the country’s expanding affluent middle class.
China’s combined emphasis on technological development and environmental protection are the target of the “Global X China Electric Vehicle” and “Global X China Clean Energy” ETFs. The former gives exposure to the opportunities in the country’s electric vehicle space, which is growing as old economy-focused cities struggle with air pollution.
Much of this pollution is produced by cars, which account for one-third of PM2.5 (atmospheric particulate matter) generation in major cities. In addition, China is one of the world’s largest oil importers, with more than half of the oil used for transportation being imported.
The country has a desire to achieve greater oil self-sufficiency, which is driving demand for more electric vehicles. China has also been the target for investment by EV companies, with the country now home to 60% of the world’s battery facilities.
With China accounting for 30% of global carbon emissions – 65% of which comes from coal power plants - the “Global X China Clean Energy ETF” includes companies that expect to benefit from the government’s policy support for producers, exporters and installers of solar panels and wind turbines.
JH Rhee, Chief Executive Officer of Mirae Asset Global Investments (HK) Ltd., says, “The launch of these new ETFs builds on our promise to provide unique and innovative ETF products and investment solutions, and provides investors a forward-looking investment approach that embraces the disruptive changes that are rapidly reshaping China.”
Wanyoun Cho, head of Asia ETF of Mirae Asset Global Investments (HK) Ltd., says, “The consumer and environment are set to be the major defining stories for China as we enter the 2020s. Companies in the consumer, electric vehicles and clean energy space are enjoying the coattails of a growing economy, increasingly affluent population and government support. The new ETFs provide broad coverage to these dynamic and fast-shifting investment ideas.”
The launch of the three new ETFs follows the listing of the “Global X China Biotech ETF” and “Global X China Cloud Computing ETF” in Hong Kong in July last year, which also provide investors thematic exposure to the vast potential of China’s biotech and cloud computing themes.
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