Yuanta Securities Investment Trust has received approval from the Taiwan Stock Exchange for the launch of two exchanges-traded-funds (ETFs) tracking the CSI300 Daily Return Leveraged 2X Index and CSI300 Daily Return Inversed Index.

The new ETFs will be targeted at investors seeking exposure to Chinese A-shares through the mutual stock access built across Shanghai and Hong Kong in November, as well as those wanting to capitalise on China’s low interest rate. According to market data, the A-shares benchmark CSI300 index recorded a 51.6% growth in 2014.

“Although professional investors are able to open accounts in Hong Kong and trade A-shares directly or invest under the Shanghai-Hong Kong Mutual Stock Connect via securities, it is still difficult for general investors to access [China] mainland’s stockmarket, and our upcoming ETFs would be able to provide them a shortcut to participate in the bull-run of A-shares,” said Julian Liu, chief executive officer at Yuanta Securities Investment Trust.

Yuanta also signed a memorandum of understanding (MOU) with Hong Kong’s China Universal Asset Management yesterday in a move to develop ETFs. The first RQFII (RMB Qualified Foreign Institutional Investors) ETFs from the cooperation is expected to be listed in Hong Kong in the second half of the year.

Although Taiwan has not yet received RQFII quotas from China, Yuanta will continue to explore renminbi solutions to fulfill the growing demand in the local market, said Liu. Cooperating with China Universal Asset Management will strengthen both companies by combining Yuanta’s expertise on ETFs along with China Universal’s knowledge in China, he said.

A Yuanta spokesperson said that the company has already submitted an application to the Securities Investment Trust & Consulting Association, and that, once listed, these will be the first leveraged and inverse ETFs in Taiwan featuring Chinese indices.

In addition, Cathay Securities Investment Trust has also confirmed plans to launch new ETFs featuring the FTSE China A50 Index.

China Universal Asset Management acquired an RQFII quota of CNY3.1bn ($0.5bn) and has launched three ETFs in Hong Kong featuring A-shares, according to newswire reports.

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