ETF gains access to onshore Chinese sovereign bonds

An exchange-traded fund (ETF) that a Hong Kong asset manager launched this week allows European investors to access the onshore Chinese sovereign bond market.

Fullgoal Asset Management (HK) launched the renminbi-denominated ETF on the London Stock Exchange on Tuesday.

The ETF invests in bonds held by the FTSE China Onshore Sovereign and Policy Bank Bond 1-10 Year Index and is a collaboration between the Hong Kong asset manager and Brussels-based Euroclear Bank, an international central securities depository that will settle trades in the fund.

Called the Fullgoal FTSE China Onshore Sovereign and Policy Bank Bond 1-10 Year Index ETF, the fund will trade in renminbi, euros and US dollars and is domiciled in Luxembourg.

Michael Chow, head of international business at Fullgoal Asset Management, said the ETF would “address international investors’ need to access Chinese onshore bond market”.

He added: “We believe as RMB [renminbi] internationalisation continues the onshore bond market presents new opportunities for international market participants.”

Fullgoal Asset Management is a wholly owned subsidiary of Fullgoal Fund Management in China, which had 337 billion renminbi (€45.27 billion) of assets under management according to its latest figure available from December 31.

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