Hong Kong lists eight ETFs to tap Chinese insurer demand for overseas assets
Listing boom comes as Beijing broadened authorised channels for mainland investors to access foreign assets
Eight exchange-traded funds (ETFs) focusing on diverse global markets debuted in Hong Kong on September 28, capitalizing on the demand from Chinese insurers seeking overseas asset exposure. This listing boom followed Beijing's expansion of authorized channels for mainland investors to access foreign assets, signaling a push to guide capital through official routes.
In an effort to address weak domestic market performance and capital outflows, China's financial regulator authorized insurance firms to invest in Hong Kong-listed ETFs via the Southbound Stock Connect scheme, starting on September 21.
Hong Kong-based asset managers are actively seeking to launch ETFs to tap the potential capital inflows from mainland insurance funds. In September alone, 21 ETFs have launched or are set to debut, marking one of the largest waves of ETF listings in the city and pushing the total number of debuts in 2026 above 50. Analysts at Huatai Securities estimate that a 1% allocation from mainland insurers to such ETFs could represent over 400 billion yuan (US$59.6 billion) of fresh capital.
Hong Kong-listed ETFs must maintain at least 60% exposure to Hong Kong equities to be eligible for sale to mainland investors through the Stock Connect. The newly listed ETFs focus on various global themes, including South Korean chipmakers, US tech firms, and Malaysian large caps. Three of these ETFs track HKEX's cross-market indices: the HKEX Bursa Malaysia Large Cap Index, the HKEX KRX Semiconductor Index, and the HKEX Tech & US Tech 100 Index.
The launch of these ETFs is expected to bolster the vibrancy of HKEX's equities, ETF, and derivative ecosystem. Hong Kong's Exchange CEO Bonnie Chan emphasized the ongoing expansion of HKEX's index business. However, the actual demand for these ETFs remains to be seen, given the intense competition and comparatively high exposure to Hong Kong markets.
Turnover was relatively thin in the initial trading of the eight new ETFs; the Hang Seng AI Advancement ETF led the trading volume on the first day with HK$1.36 million (US$173,388) turnover but experienced a 5.6% decline.
Written by urgent.news from The Business Times - Companies & Markets's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
