Last Thursday, Deutsche Asset & Wealth Management said it will have to limit creations of new shares of ASHR and the Deutsche X-trackers Harvest CSI 500 China A-Shares Small Cap Fund (NYSEArca: ASHS) because strong demand for those ETFs forcing the two ETFs to bump up against their respective Renminbi Qualified Foreign Institutional Investor (RQFII), which allows the funds to purchase A-shares equities. [Heavy Demand Forces Limited Creations in A-Shares ETFs]
In a statement, Deutsche Asset & Wealth Management said starting on Nov. 24, ASHR and ASHS will accept just one creation unit of 50,000 shares each day per fund. The firm made a similar announcement in September and it took about a month for the creation limits to be lifted for ASHR and ASHS.
From Nov. 3 through Nov. 14, ASHR, KBA and PEK gained an average of 5.6% while investors poured $72.1 million into ASHR. Since the start of the fourth quarter, ASHS, the small-cap offering, has nearly doubled in size.
The Hong Kong, Shanghai and Shenzhen exchanges are the sixth-, seventh- and tenth-largest, respectively, in the world by market value, according to KraneShares, KBA’s issuer. Of the nearly 570 Shanghai-listed stocks that will be made available in the Connect effort, those stocks represent 90% of the Shanghai Stock Exchange’s market value and 80% of the daily turnover, according to KraneShares data.
Deutsche X-trackers Harvest CSI 300 China A-Shares ETF