The Hong Kong-listed fund will track the top 50 stocks in Shanghai and Shenzhen Barclays Global Investors will launch a Hong Kong-listed exchange-traded fund (ETF) next week, offering investors an opportunity to buy into the mainland's restricted A-share market. The ETF will track the FTSE/Xinhua China A50 Index, which comprises the top 50 A shares in Shanghai and Shenzhen. It will target institutional and retail investors. Currently, institutional investors can buy A shares through banks with a qualified foreign institutional investor (QFII) quota, but small-scale retail punters do not have that opportunity. 'This is really the only product retail investors can use to get exposure to the full China market, including the many growing private enterprises,' said Joseph Ho, the regional director for North Asia at Barclays. While H shares and red chips were one investment possibility, they only represented a small part of the mainland market, Mr Ho said. Because the ETF - to be sold under the name of iShares FTSE/Xinhua A50 China Tracker - will be listed on the Hong Kong stock exchange, retail investors can also buy it through their brokers. Barclays would not be using its QFII quota for the product, Mr Ho said. It would work with Citigroup Global Markets, which would create US$20 million worth of ETF units based on specially designed warrants that were exchangeable with the underlying A shares. Although two similar ETF products were launched by Barclays in New York and London last month, there is still demand for China stocks among foreign investors, despite recent speculation about further interest-rate increases aimed at cooling economic growth. The US version, which was launched on October 8 at a size of US$20 million, had already grown to US$150 million, Mr Ho said. Both the London and New York-listed funds track the FTSE/Xinhua China 25 index, which consists of leading H shares and red chips listed in Hong Kong. This makes them less exposed to regulatory risks and concerns about disposals of state-owned shares, which together with fears about an economic slowdown have plagued the A-share market this year. The minimum investment in the A-share ETF is one board lot of 100 units, which will cost about $4,000 to $5,000 at the launch.