Daily ETF Watch: DB Plans All-China ETF

January 24, 2014

This one is a bit of a departure from other DB proposed offerings.

Deutsche Bank, the purveyor of the first-to-market China A-shares ETF, has filed regulatory paperwork for a China-focused fund to invest directly in the broadest possible spectrum of large- and mid-capitalization Chinese companies. It follows by about a month a filing from Market Vectors describing plans for a similar all-China ETF.

China remains something of a frontier in the world of investing, and ETF issuers have been aggressively looking for opportunities in the world’s second-largest economy. Apart from Market Vectors, China-focused KraneShares is also looking to offer investors new ways to tap into China, notably through the Chinese A-shares market of companies whose shares are listed on the Shanghai and Shenzhen exchanges.

DB’s latest offering, dubbed the db X-trackers Harvest MSCI All China Equity Fund (ASHA), will look to invest in large- and mid-capitalization Chinese securities in mainland China and Hong Kong, as well as securities of Chinese companies listed in the U.S. and Singapore.

The new proposed offering will track the MSCI All China Index, a departure from other DB proposed offerings that are benchmarked against Chinese Securities Index indices, noted IndexUniverse analyst Howard Lee.

DB’s latest proposed fund is similar to Market Vector’s proposed Market Vectors All China ETF, which will look to gain direct exposure to the region via China A-shares as well as indirect exposure to the Chinese market via China B-shares, China H-shares, China red chips and China P-chips share classes, as well as securities of Chinese companies listed in the U.S. and Singapore.

Market Vectors, in regulatory paperwork submitted to the Securities and Exchange Commission (SEC) last month, didn’t say what index it might use in its proposed all-China ETF.

Filings

Eaton Vance filed updated paperwork to request permission to begin offering a lineup of so-called exchange-traded managed funds (ETMFs), which would price at the end of the day like mutual funds, but have the tax advantages and relatively low expense ratios associated with ETFs.

The rumor mill has been swirling lately that the SEC is close to approving the concept. Eaton Vance has plans to roll out an ETMF version of each of its existing mutual funds.

 

 

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