Institutions are increasing their use of ETFs to access Chinese equities and bonds according to new research by NTree International.
Over three quarters (78%) expect to see an increase in the use of ETFs to access Chinese asset classes over the next three years, found a survey carried out for ETF manager China Post Global.
Two-thirds (67%) of the institutions polled and that speak for US$293bn of managed assets said ETFs provided a more specialist and niche exposure to Chinese equities and bonds.
A further 60% said it is because there is greater innovation in the ETF marketplace, over half (55%) said that they are more competitive than mutual funds, and 54% said that their liquidity is expected to improve.
Tim Harvey, NTree’s chief executive, said: “Our research shows the growing demand for Chinese asset classes among institutional investors but also a desire for specialist, innovative products such as ETFs which can provide access at more competitive prices.”