FTSE/Xinhua Index Limited is a joint venture between FTSE Group, the global index company and Xinhua Financial Network (XFN), an independent financial information provider with unique access into China's markets. The combination of FTSE's expertise in the design, calculation and management of indexes and XFN's knowledge and experience in the Chinese investment market makes the FTSE/Xinhua China 25 Index an excellent benchmark for tracking the performance of the large cap equity market in China.
The iShares FTSE/Xinhua Hong Kong China 25 ETF will track the FTSE/Xinhua China 25 Index, which features the largest, most liquid Chinese equities available to foreign investors. The index constituents are accurately classified according to the sector definitions of the FTSE Global Classification system. The constituents of the FTSE/Xinhua China 25 Index are adjusted for free-float and subject to liquidity screens for investability. The index is capped to ensure that no individual company is excessively weighted in the index and that funds tracking the index comply with European and North American market regulations.
Mark Makepeace, FXI Chairman and Chief Executive, FTSE Group said, "International investors are eager for a China index series that adopts transparent global standards like the FTSE/Xinhua China 25 Index. The FTSE/Xinhua China Indexes reflect China's vibrant economy and aim to contribute to the internationalization of the Chinese investment market. It's great to work with BGI to bring the first China ETF to the US market."
Lee Kranefuss, BGI's CEO of Individual Investor Business said, "There is strong demand to bring to market a cost-effective, tax efficient way for investors to gain access to the largest, most liquid Chinese securities. The FTSE/Xinhua Hong Kong China 25 is a great complement to the current international iShares line-up. We are delighted to work with FXI to provide innovative products to help investors diversify and globalize their portfolios."
With the addition of the FTSE/Xinhua Hong Kong China 25 to FTSE Group's growing product portfolio, FTSE is rapidly expanding its reach in the ETF market. There are currently 26 ETFs listed on FTSE Indexes with almost US $810 million in assets under management. FTSE has previously licensed 12 indexes to BGI for use as the basis of iShares Funds, including the widely used FTSE 100.
