- New index captures emerging markets, China A-shares and China N-shares
- Furthers FTSE’s innovation to help participants prepare for the inclusion of China A-shares in global benchmarks
KraneShares launches ETF tracking new FTSE index Global, February 17, 2015: FTSE Group (“FTSE”), the global index provider, has expanded its range of GDP Weighted Indices with the launch of the FTSE Emerging incl. China Overseas non-R/QFII GDP Weighted Index. The new index gives global market participants access to benchmarks comprising of emerging markets and Chinese equities including China A-shares, N-shares and S-chips, which are adjusted by GDP weighting rather than market capitalisation. The innovative index is designed to reflect the growth of China’s economy and help market participants prepare for the future inclusion of China A-shares in global benchmarks.
In conjunction with the new FTSE index, KraneShares, a US company focused on providing ETFs for the next-wave of China's development, today launched the KraneShares FTSE Emerging Markets Plus ETF, which tracks the GDP weighted index.
Mark Makepeace, Chief Executive, FTSE Group, said:
“The inclusion of mainland Chinese stocks (A-shares) in international portfolios will have a sizable impact in the future, and FTSE remains committed to helping market participants prepare for this change through the development of new benchmarks. We are delighted to work with KraneShares for the first time, applying our more than 10 years of practical experience in developing China market indices.
Jonathan Krane, CEO, KraneShares, added:
“Our latest ETF (BATS: KEMP) is a milestone for the industry as the first US ETF to offer emerging market and China A-share exposure. It is also the first ETF in the US with a GDP weighting rather than the traditional market-capitalisation weighting. We look forward to continuing our relationship with FTSE to deliver more China-focused exchange traded funds so investors are well positioned at the forefront of China’s developing equities market.”
The FTSE Emerging incl. China Overseas non-R/QFII GDP Weighted Index is a combination of securities from three different underlying index series:
- The FTSE Emerging Index, part of the FTSE Global Equity Index Series
- The FTSE China A Index, including A-shares
- The FTSE China Overseas Index, including N-shares and S-chips
In addition, the new index is adjusted by GDP to reflect the performance of constituent companies where country weightings are proportionate to the country’s forecast GDP. The methodology uses the five year GDP forecasts at Purchasing Power Parity (PPP) published by the International Monetary Fund (IMF) to determine the country weightings.