Traders looking to add juice to already high-flying China A-shares exchange traded funds have a new option with today’s debut of the Direxion 2x Daily CSI 300 China A Share ETF (NYSEArca: CHAU), the first leveraged A-shares ETF to list in the U.S.
The Direxion 2x Daily CSI 300 China A Share ETF will attempt to deliver twice the daily performance of the CSI 300 Index. The CSI 300 Index is underlying benchmark for the Deutsche X-trackers Harvest CSI 300 China A-Shares ETF (NYSEArca: ASHR) and the Market Vectors ChinaAMC A-Share ETF (NYSEArca: PEK). [A Bold Approach to A-Shares ETFs]
China A-shares, which trade on the Shanghai and Shenzhen Stock Exchanges, account for roughly two-thirds of the market capitalization of Chinese stocks. Since most foreign investors cannot purchase China A-shares, investors in most existing China ETFs lack exposure to the majority of Chinese companies. Aside from CHAU, no other ETF currently provides leveraged exposure to this asset category, according to a statement from Direxion.
Over the past year, A-shares have been among the world’s best performers with ASHR and PEK each posting gains in excess of 110%. Three of the six ETFs that have hit all-time highs to this point in Thursday’s session are A-shares funds, including ASHR and PEK.
Last year, investors added nearly $475 million to ASHR and $44 million to PEK. PEK recently topped $100 million in assets under management. ASHR is the largest U.S.-listed A-shares ETF with nearly $1.2 billion in assets. [A-Shares ETF Tops $100M in AUM]