China's equity exchange-traded funds (ETFs) market has been attracting growing foreign investment and the scale of Chinese asset-related ETFs around the world is also increasing as international investors speed up buying high-quality Chinese assets.
The A-share market has witnessed accelerating net inflow of foreign investment this year with ETFs being a major channel for investors around the world to buy the country's assets.
According to the latest half-yearly reports, Barclays now holds 200 ETFs compared with last year's 135 and the UBS Group AG holds 141 ETFs, more than doubled from the previous 57.
The industries related to artificial intelligence and robots drew most attention from foreign investors apart from other sectors like new consumption and innovative drugs.
In addition to holding Chinese assets directly in the country's domestic market, investors around the world are also buying them through ETFs issued on the international market.
The ETFs issued by institutes like BlackRoc and the Vanguard Group, which track China stock indexes, have been drawing increasing attention from market.
"As of Aug 29, the capitals under the management of five offshore ETFs of relative large scale linked to Chinese stocks have totaled 26.6 billion U.S. dollars, up by over 10 percent compared with late July," said Yang Delong, chief economist at the First Seafront Fund.
Analysts said foreign investors are showing their recognition of the long-term value of Chinese assets by putting their money into offshore ETFs, which represent medium-to-long-term allocation strategies.
"Foreign investors are particularly focused on long-term factors when buying Chinese assets and their core focus is on predictability, such as the capability of China to pursue sustainable long-term economic growth and the stable global statuses of the country's high-potential sectors. Inflow of foreign investment not only boosts market sentiment but also reinforces the international recognition of RMB-linked assets," said Ronald Wan, chief executive at the Partners Fintech Holdings Limited.
China's ETF market draws increasing foreign investment
