The institution of collective investment shows its effectiveness over a long period. It is difficult for private investors to adhere to two main investment principles: invest in what you know in and diversify risks. Hong Kong is the financial gateway to Asia, representing the Chinese economy to private and institutional investors in all its diversity. It should be remembered, however, that the Hong Kong dollar is pegged to the US dollar: as a result, investments in Hong Kong benefit the two largest economies in the world: China and the United States.
The Hong Kong stock market has a wide range of investment instruments and is rightfully becoming the leading ETF market in Asia. In 2020, USD 5 billion was raised in the ETF market, and the market volume was USD 50 billion
The leaders in terms of profitability on the Hong Kong Stock Exchange in 2020 were:
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Global X China Clean Energy ETF. The fund was founded in January 2020 and already in the first year, the return was 82.8%. The total value of the fund's assets is USD 387.3 billion. The fund includes assets of 20 energy companies in China. TOP-3 assets: CHINA YANGTZE POWER CO LTD - 9.91% of the company's shares, TIANJIN ZHONGHUAN SEMICOND - 9.85%, SUNGROW POWER SUPPLY CO LT - 9.81% .
- The Global X China Electric Vehicle and Battery ETF is a fund that invests in Chinese electric vehicle and battery manufacturers. The fund was also established in January 2020 and has shown an annualized return of 109.3%. The fund's assets are valued at USD 924.9 billion. The fund includes assets of 20 battery manufacturers in China. TOP-3 assets: WUXI LEAD INTELLIGENT EQUI - 9.92% of the company's shares, JIANGXI GANFENG LITHIUM CO - 9.49% , EVE ENERGY CO LTD - 9.42% .
- Global X China Biotech ETF is a fund investing in Chinese biotech companies. The fund was founded in 2019 and showed a return in 2020 of 69.7%. The fund's assets are valued at USD 434.8 billion. The fund includes the assets of 29 biotech companies in China. TOP-3 assets: WUXI BIOLOGICS CAYMAN INC - 10.15% of the company's shares, BEIGENE LTD-ADR - 9.95%, WUXI APPTEC CO LTD - 9.8%
The most popular ETFs on the Hong Kong Exchange:
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Tracker Fund of Hong Kong - ETF pegged to the main index of the Hong Kong Stock Exchange - Hang Seng. In 2020, the fund's asset value increased by 26%. The reliability of this fund is guaranteed by the government of Hong Kong. It should be remembered that the Hang Seng is one of the key and oldest Asian stock indices, and from its dynamics one can draw conclusions about the state of the economy as a whole.
- CAM CSI300 is an ETF linked to the CSI300 index, which includes the 300 largest companies traded on the Shanghai and Shenzhen exchanges, in fact, the largest Chinese public companies. It is important that trading on these two sites is denominated in RMB, not Hong Kong dollars. Companies with the largest shares in the index: Kweichow Moutai Co Ltd - 5.53%, Ping An Insurance Group - 3.83%, China Merchants Bank Co Ltd - 3.53%. The fund's profitability for 2020 was 28.16%.
- CSOP A50 ETF is an ETF linked to the FTSE China A50 Index, which includes the 50 largest companies that list type A shares on the Shanghai and Shenzhen Stock Exchanges (the index is also denominated in RMB). TOP-3 assets: Kweichow Moutai Co Ltd - 12.45%, China Merchants Bank Co Ltd - 8.68%, Ping An Insurance Group - 8.34%. The return for 2020 was 24.48%.
The Hong Kong Exchange is a prospective area for investment, but Russian brokers rarely provide an opportunity to trade securities on this site. Shares of Hong Kong companies are extremely poorly represented on Russian stock exchanges. However, the St. Petersburg Stock Exchange is doing a great job of increasing the number of instruments available in Russia that are traded on the Hong Kong Stock Exchange.
In general, given the trends in the global financial market, we can say that Hong Kong will gradually pull into a central role on a global scale, competing with London and New York.
If you have questions or need advice on trading on the Hong Kong stock exchange, you can leave a request in the feedback form or contact our specialists:
Maxim Kuznetsov - vice-president of the RAUIE
investment@raspp.ru
WeChat: maximkuznetsov
