ETF Explainer: RQFI
Our explainer takes a look at the db X-trackers Harvest CSI300 UCITS ETF and its wild ride over the past 12 months as China's market has seesawed.
Each issue, we look at an ETF with a particularly interesting chart and explain the market forces behind its performance. This time, we look at the db X-trackers Harvest CSI300 UCITS ETF, an exchange traded fund which has around £158 million in assets under management, and which had a very volatile year, including a phenomenal rally until the summer and a steep decline in July and August.
For a larger view, please click on the image above.
OCT 16 China A-shares rally more than 50% in 2014 as the country shifts to a more manageable growth pace, even as investors remain concerned about long term issues.
JAN 7 2015 starts with a bang as the A-shares rally begins, with the underlying index already rising 5 7 6% to 775 points from 16 Oct.
JUN 8 After a whopping rise of 120% from 16 Oct., the China A-shares market reaches its summer peak in line with investor confidence and their increasing leverage.
JUL 8 The Chinese government steps in at the peak of volatility to prop up its equity market. Over half of A-shares suspend trading. Investors are banned from selling. RQFI drops 14% in two days.
AUG 24 A-shares have fallen almost 50% and reach a trough as capital markets go into free fall, partly spurred by uncertainty in China. Many A-shares are still not trading.
OCT 15 Investors' consensus is still bearish on China but analysts maintain A-shares will stabilise by year end and China's reforms will continue. RQFI gains 20% since 24 Aug.
