Bosera Asset Management raises US$200 million for China’s ‘first’ sustainable development exchange-traded fund
- China’s second biggest fund manager closed its first ETF themed on social and environmental values, with strong interest at home and in Argentina
- The ETF is scheduled for listing on the Shanghai Stock Exchange in February
Bosera Asset Management has raised US$200 million for what it claims to be China’s first exchange traded fund (ETF) with a sustainable development focus, backed by strong interest from institutional investors at home and in the Americas.
The asset manager, China’s second-biggest fund house by asset under management, excluding money-market funds, wrapped up its global marketing for the fund last week.
Strong interest from institutional investors, including “two or three” hedge funds from overseas, as well as investors from Argentina, has led Bosera to consider setting up feeder funds offshore to cater to foreign investors’ demand, said Steve Wang, deputy head and portfolio manager at Bosera’s passive and quant investment department.
The fund, called “Bosera CSI Sustainable Development 100 ETF”, tracks the CSI Sustainable Development 100 index, run by the China Alliance for Social Value Investing (CASVI). CASVI develops quantitative assessment models for sustainable financial products in China and is chaired by banking veteran Ma Weihua, former president of China Merchants Bank.
CASVI states on its website that its Sustainable Development 100 index has delivered an annualised return of 4.3 per cent above the CSI 300 index, over the five years to July 2019.
“One should think about sustainable development being a broader thematic investing approach on top of the ESG [environmental, social and governance]. It’s also a way for achieving enhanced returns from the CSI 300 Index,” said Wang.
The new sustainable fund is scheduled to list on the Shanghai Stock Exchange next month, though the exact date is not yet known. It will add to Bosera’s existing 80 billion yuan (US$11.7 billion) ETF portfolio, part of an overall portfolio of 1.07 trillion yuan in assets under management.