CSOP’s China bond ETF grows 10-fold amid robust foreign inflows

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SHANGHAI, Nov 16 (Businesshala) – A Hong Kong-listed China onshore bond fund saw a 10-fold jump in size over the past month on strong money inflows, its asset manager said on Tuesday, amid rising foreign interest in the world’s second largest Underlines. Counterpart Market.

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The CSOP Businesshala China Treasury + Policy Bank Bond Index ETF has increased its assets under management (AUM) to 5 billion yuan ($784.61 million) after attracting “large” investments from institutional investors, CSOP Asset Management Ltd said in a statement. extended to more than

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Gao Ming, president and executive director of ICBC (Asia), whose asset management arm is an advisor to the ETF, said in the statement.

Separately, a company official said net inflows exceeded 4.5 billion yuan in the last month alone.

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Listed in early February 2014, the ETF has achieved a return of 30.54%, the company said in the statement.

AUM in the CSOP’s China Bond ETF exploded as the FTSE Russell began last month to include Chinese government bonds in its major global index.

It also comes as China recently successfully sold offshore sovereign bonds in Hong Kong, highlighting foreign confidence in China despite its economic slowdown, and the country’s real estate debt troubles that rocked the Chinese dollar bond market.

The spread between China’s 10-year Treasury bonds and their US counterparts has eased over the past year, but remains attractive to attract global investors, at around 1.3 percentage points.

“China’s onshore bonds offer high yields with relatively low exchange rate volatility compared to other major economies,” CSOP Asset Management said in the statement.

“Furthermore, the lower correlation between China’s onshore bonds and global bonds would potentially provide greater portfolio diversification for investors.”

Foreign investors held Chinese government bonds totaling 2.3 trillion yuan at the end of October, the highest level on record and up 1.06% from a month earlier.

$1 = 6.3726 yuan Reporting by Samuel Shen and Andrew Galbraith; Editing by Jacqueline Wong

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