China plans to introduce an exchange traded fund that invests in Hong Kong stocks in an effort to raise the city’s standing as a financial center, according to reports.
The move is part of a package of measures announced by Vice Premier Li Keqiang, according to a Bloomberg report.
“The ETF constituted by Hong Kong-listed stocks will be launched,” Li said in Hong Kong, according to the report. “Its status as a financial center in Asia and globally is crucial for Hong Kong’s development.”
“Few details were provided on the structure of the ETF, though analysts said it would likely be listed in Shanghai and enable access to constituents of the Hang Seng index as well as other large-cap stocks listed in Hong Kong,” MarketWatch reported.
The U.S.-listed iShares MSCI Hong Kong (NYSEArca: EWH) is down 8.2% year to date, according to Morningstar. [Hong Kong ETF in Focus]
iShares MSCI Hong Kong