CSOP: Pioneering Cross-Border Opportunities in HK, Bridging China and Saudi Arabia’s Capital Markets
HONG KONG--(BUSINESS WIRE)--CSOP Asset Management Limited (CSOP) is honored to announce the listing of CSOP Saudi Arabia ETF, the first exchange traded product in Asia Pacific tracking the Saudi Arabian equity market1. We are privileged to have the opportunity to work with the Public Investment Fund (PIF) on this new venture, opening up a gateway and a unique opportunity for Asian foreign investment and access to Saudi’s dynamic and diversified equity market.
PIF is the investment engine driving economic growth in Saudi Arabia and the world. A global, long-term, impactful investor and catalyst of change, PIF plays a critical role in unlocking opportunities to accelerate economic growth. Today, we are bringing Saudi Arabia’s wealth of investment opportunities to the doorstep of investors in Asia. PIF is an anchor investor in CSOP Saudi Arabia ETF.
CSOP Saudi Arabia ETF (HKD counter: 2830, RMB counter: 82830) tracks the FTSE Saudi Arabia Index, providing exposure to more than 50 leading large and mid-cap companies listed on Tadawul, Saudi Arabia's stock exchange. The ETF comprehensively covers sectors including financials, basic materials, energy, and telecommunications, capturing the drivers of Saudi Arabia’s economy while providing diversified exposure. FTSE Saudi Arabia Index has achieved a significant return of 45.3% in the past three years2.
CSOP Saudi Arabia ETF is a physical ETF that adopts a combination of physical and synthetic representative sampling strategy, investing up to 100% of its net asset value in a representative portfolio of securities that collectively has a high correlation to the FTSE Saudi Arabia Index, to achieve its investment objective. The ETF will list with an initial investment of over USD 1 billion, making it the largest Saudi Arabia ETF globally 3. The ETF has a listing price at around HKD 78 per unit, trading lot size of 10 units and annual management fee of 0.99%.
The Honorable Mr. Paul Chan, Financial Secretary of HKSAR said: “The launch of the CSOP Saudi Arabia ETF is a significant milestone. It makes possible for mass market investors in our part of the world to invest and participate in the development of the Saudi Arabia’s economy, allowing them to benefit from the vast opportunities of the country’s bright and promising future. Hong Kong, under the ‘one country, two systems’ framework, with our sound financial and judicial infrastructure, free flow of capital, goods, talent and information, and a simple tax regime, is in a unique and strategic position to be a key partner of Saudi Arabia in realization of its Vision 2030, in particular its second pillar ‘to become a global investment powerhouse’. We can expect to see more products to be made available in both the Hong Kong and the Saudi markets for our respective investor bases.”
Yazeed A. Al-Humied, Deputy Governor and Head of MENA Investments at PIF, said: “The launch of CSOP Saudi Arabia ETF is a significant milestone for PIF as we continue to further deepen cross-geography partnerships. This will unlock unprecedented opportunities between the key capital markets hub of Hong Kong and the Saudi equity market, one of the most attractive destinations for capital inflows in the world today. The launch of this ETF reflects PIF’s ongoing commitment to developing the Saudi capital market and opening it up to international investors while delivering on its mandate and Vision 2030 targets.”
“We are excited and honored to bring to Hong Kong Asia’s first Saudi Arabia ETF, taking the first step in connecting the capital markets between HK and Saudi.” said Chen Ding, CEO of CSOP. “CSOP has always been dedicated to enriching Hong Kong’s ETF ecosystem, and we endeavor to keep bringing interesting and differentiated products to our clients in the region. I would like to thank the Public Investment Fund, for entrusting CSOP as their partner in bringing Saudi to Asia. My sincere thanks go to our trusted partners – HKSFC, HKEX and HSBC, for their continued support and commitment to the growth of HK’s ETF industry.”
“The Saudi ETF launch in Hong Kong marks a new beginning in the long tradition of Saudi-Chinese friendship and in Asian market connectivity,” said Ms. Julia Leung, Chief Executive Officer of the Securities and Futures Commission (SFC). “We are confident Saudi-Hong Kong ties will scale new heights as we explore further opportunities together from cross-listings, sustainability, fintech, asset management and other areas.”
Luanne Lim Chief Executive of HSBC Hong Kong, said: “It is our honor to have played a part in bringing CSOP Asset Management and the PIF together. With HSBC’s extensive global network and industry expertise, we are in a unique position to connect clients and capital, supporting their growth agendas and driving product innovation in today’s ever-changing investment landscape.”
CSOP is a leading ETF issuer in Hong Kong SAR, with a wide range of product offerings across equity, fixed income, leveraged and inverse, thematic, money market, and virtual assets. In 2023, 6 out of 10 of the most traded ETFs on the Hong Kong Stock Exchange are CSOP-issued products*. Innovation and leadership are deeply rooted in CSOP’s DNA as we strive to bring first-of-its-kind products to the market, educate investors about ETF trading, and never stop looking for ways to improve trading efficiencies.
CSOP’s commitment to cross-border initiatives and collaborations is unwavering. we are the only product issuer participating in all the ETF connectivity programs between mainland China and Hong Kong SAR, capturing an 89% market share of the aggregate southbound AUM**, as well as the first issuer to participate in the China – Singapore Cross-border ETF Link Scheme.
* Source: Daily average from 1 January 2023 to 30 September 2023, Bloomberg
** Source: As of 28 September 2023, 89% of southbound connect total AUM is from CSOP Hang Seng TECH Index ETF and CSOP Hang Seng Index ETF, CSOP
This document is for general information only and do not constitute investment or any other kind of advice in any way and shall not be considered as an offer or solicitation to deal in any investment products. Investment involves risk. Investors should refer to the Prospectus and the Product Key Facts Statement for further details, including product features and risk factors. Investors should not base on this document alone to make investment decisions. Investors should consult their own advisors before engaging in any transaction. CSOP which prepared this document believes that information in this document is based upon sources that are believed to be accurate, complete and reliable. However, CSOP does not warrant the accuracy or completeness. This document is not legally binding, and CSOP shall not be liable for any loss, damage or expense incurred. This document is not directed to, intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution, availability or use would be contrary to local law or regulations, or which would subject CSOP to any registration or licensing or other requirement, or penalty for contravention of such requirements within such jurisdiction. For the Index Provider Disclaimer, please refer to the Product’s offering document. This document is prepared by CSOP and has not been reviewed by the SFC in Hong Kong.
1 Source: CSOP. ^Bloomberg, as of 2023/10/31. The definition of “Asia Pacific” follows FTSE Russell’s definition in FTSE Global Equity Index Series, v12.2, June 2023, which said Asia Pacific includes Australia, Hong Kong China, India, Indonesia, Malaysia, New Zealand, Pakistan, Philippines, Singapore, South Korea, Taiwan China, Thailand, mainland China and Japan.
2 Source: FTSE Russel, 31 October 2020 to 31st October 2023
3 Source: Bloomberg, 28 November 2023