BlackRock to launch Hong Kong’s cheapest Hang Seng Index ETF
New fund will have ongoing charges of nine basis points, beating the 10bps of the market leader, Tracker Fund of Hong Kong.
BlackRock, the world’s biggest asset manager, is launching Hong Kong’s cheapest Hang Seng Index Exchange Traded Fund (ETF) to steal a march on Tracker Fund of Hong Kong, the city’s most-popular ETF.
BlackRock’s iShare Core Hang Seng Index ETF, to be listed on November 23, is the city’s third ETF that tracks the blue-chip benchmark, following Tracker Fund, managed by State Street Global Advisors Asia and Hang Seng Index ETF by Hang Seng Investment Management.
ETFs are marketable securities that track an index, a commodity, bonds, or a basket of assets.
The new ETF will have ongoing charges of nine basis points, beating the 10bps of Tracker Fund. It has also set its minimum investment threshold at HK$800 per lot, the lowest among the three, and allows investors to trade in Hong Kong dollars, yuan and US dollars.
Cyrus Mui, director of iShares, said the fee decision was made as the business scale and efficiency of BlackRock worldwide allows it to offer such a low-cost ETF.
“We don’t consider this as competing with Tracker Fund, but felt this is what we are able to offer,” Mui said.
