KraneShares kicked off August with the launch of an ETF of Chinese Internet-focused companies that are listed either in Hong Kong or outside of China. The KraneShares CSI China Internet ETF (KWEB) has an annual expense ratio of 0.68 percent.
The indexing methodology behind the ETF's underlying CSI Overseas China Internet & Communication index offers something of a novel take on the Chinese market. The index cherry-picks 25 firms, most of which are listed entirely outside of China in places like New York. The foreign listing means the shares of such firms are denominated in dollars.
A total of 21 index constituents are so-called N-shares (notably Baidu) that are incorporated and listed outside of China; while the remaining four are H-Shares (notably Tencent Holdings) that are incorporated in mainland China but listed in Hong Kong.