the first ETF for long duration Chinese government bonds
HONG KONG, April 13, 2021 /PRNewswire/ — Premia Partners, a leading ETF provider in Hong Kong, announces today listing of two China bond ETFs at HKEx.
These physically replicated ETFs offer cost-efficient, unique and convenient access to the sweet spots in offshore China USD bond and onshore China government bond (CGB) markets.
- Premia China USD Property Bond ETF (Tickers: 3001 HKD / 9001 USD/ 83001 RMB) with current yield of ~7%* is the first SFC authorized high yield bond ETF in Hong Kong. It tracks the ICE 1-5 Year USD China Senior Real Estate Corporate Constrained Index, for USD denominated high grade and high yield debt securities issued by Chinese real estate corporate issuers. The strategy takes a rule-based, diversified approach with 5% limit on issuer group, covers only secured and senior issues rated by S&P, Moody’s or Fitch, excluding local government financing vehicles (LGFVs) and subordinated debts.
- Premia China Treasury & Policy Bank Bond Long Duration ETF (Tickers: 2817 HKD / 9817 USD/ 82817 RMB) tracks the ICE 10+ Year China Government & Policy Bank Index, with average duration of ~18 years*, making this globally the first ETF that provides direct access to ultra-long duration China treasury and policy bank bonds traded in onshore China. As important building block for long duration CGB exposure, the ETF complements existing China Treasury ETFs amid global government bond index inclusion. BOCHK Asset Management Limited (a member of the Bank of China Group) is the investment advisor.
*As of April 14th 2021
“We are delighted to launch these unique ETFs that offer attractive risk-adjusted returns in this low yield environment,” said Rebecca Chua, Managing Partner of Premia Partners. “Now without opening onshore China bond accounts, investors can conveniently access long duration CGBs onshore and high yield USD China bonds offshore through HKEx, and without stamp duty, withholding or capital gains tax.”
Mr Shen Hua, Chief Executive Officer of BOCHK Asset Management Limited (“BOCHKAM”) said, “BOCHKAM is delighted to co-launch with Premia Partners the first long-duration RMB bond ETF. This ETF enjoys low-cost investing, trading flexibility and high transparency comparing to traditional mutual funds, providing an investment alternative for investors to satisfy their needs for asset allocation. We are committed to providing more high-quality products to facilitate RMB internationalisation and help Hong Kong to develop as a global asset management centre.”
“As a leading provider of index services for global ETFs and fixed income evaluations, ICE is delighted to collaborate with Premia Partners on these two unique products,” said Magnus Cattan, Vice President of Fixed Income and Data Services, Asia Pacific at ICE. “As investor interest for China bonds continues to grow rapidly, ICE is honoured to contribute to the market development with more innovative solutions.”
About Premia Partners
Founded in 2016, Premia Partners is one of the leading ETF managers from Hong Kong, dedicated to building low-cost, efficient, best practice ETFs for Asia. As of April 14th 2021, Premia Partners manages 8 ETFs including Premia CSI Caixin China New Economy ETF which is the 4th largest China A-shares ETF in Hong Kong, and winner of the HKEx 2019 Top Performing ETF – Total Return Award. For more information on Premia or Premia ETFs covering China, Emerging ASEAN, Asia Innovative Technology, Vietnam, China high yield bonds, China government bonds and US Treasury, please visit www.premia-partners.com
About BOCHK Asset Management Limited
Established in 2010, BOCHK Asset Management Limited (“BOCHKAM”) is a wholly owned subsidiary of BOC Hong Kong (Holdings) Limited, which is one of the largest listed companies and commercial banking groups in Hong Kong, and a member of the Bank of China Group. BOCHKAM is committed to providing retail and institutional investors with a wide array of bond, equity and alternative investments products. In 2020, the company was garnered as “Best RMB Manager” in the 2020 Best of the Best Awards in Hong Kong by Asia Asset Management and “Outstanding Achiever, China Fixed Income House Award” in Fund of the Year Awards by BENCHMARK.
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