Taiwan’s First China Fixed Income ETFs Adopt Bloomberg Barclays China Indices

Yuanta and Fubon launch Taiwan’s first China fixed income ETFs for investors

Taipei – Bloomberg, the global index provider, announced today that two leading Taiwanese ETF providers, Yuanta Securities Investment Trust Company and Fubon Asset Management, have adopted Bloomberg Barclays’ China Aggregate Index as the underlying indices for the first China bond ETFs to debut in Taiwan.

The ‘Bloomberg Barclays China Treasury + Policy Bank 3-5 Years Total Return Index’ and the ‘Bloomberg Barclays China Policy Bank Total Return Index’ have been adopted by Yuanta and Fubon respectively. Both indices are derived from the Bloomberg Barclays China Aggregate Index, which was first introduced to the market in 2004. The two ETFs launched in Taiwan are:

• The Yuanta China Treasury + Policy Bank 3-5 Year Bond ETF (Bloomberg Ticker: 00721B TT Equity)
• The Fubon China Policy Bank Bond ETF (Bloomberg Ticker: 00718B TT Equity)

Data provided by China Central Depository and Clearing Co. and Shanghai Clearing House show foreign bond holdings reached RMB 1147.4 billion (US$181.4 billion) at the end of 2017, representing an increase of 43% over the same period the previous year. Taiwan-listed ETFs grew by 29% in total AUM as of September 2017 from December 2016, according to the figures from the Taiwan Stock Exchange.

“Taiwan’s bond ETF market is off to a strong start this year,” said Ryan Chang, fixed income ETF manager at Yuanta Securities Investment Trust Company. “In a market dominated by equity ETFs, we saw the increasing demand for assets that offer strong yields at a lower risk profile. We launched Taiwan’s first China bond ETF tracking China’s government and policy bank bonds because it offers exactly that type of exposure, and we also see this appealing to both local and international investors.”

Patrick Liao, senior vice president and head of the quantitative index investment department at Fubon Asset Management added, “By launching one of the largest ETFs in the world tracking China bonds, we were confident that investor interest would be high. We are optimistic about its prospects, and are pleased to have selected Bloomberg as the benchmark index provider for our first China fixed income ETF.”

With a 45-year tradition, the Bloomberg Barclays Indices are the most widely-used indices for fixed income investors seeking objective, rules-based and representative benchmarks to measure asset class risk and returns. A leader in fixed income investing, Bloomberg Barclays Indices offer unmatched market coverage, including global fixed income, inflation-linked and swap benchmark indices.

“This is an exciting development for investors in Taiwan looking for an entry point into China’s bond market,” said Norman Tweeboom, Head of Portfolio & Index Sales for Asia-Pacific at Bloomberg. “It’s a matter of when, not if, Chinese bonds will be fully included in global fixed income benchmark indices. When that takes place, ETFs will become an avenue for global investors wanting to gain exposure to this untapped market, and we hope to be helping to support that growth.”

Bloomberg Professional service subscribers can access the Bloomberg Barclays Indices at IN<GO>. For more information about Bloomberg Barclays indices, please visit https://www.bloombergindices.com/bloomberg-barclays-indices/.

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About Yuanta SITC

Yuanta leads the market by listing the first ETF in Taiwan. As of December 2017, Yuanta manages 38 ETF while capturing 65% market share by AUM. Yuanta is Taiwan’s leading ETF brand managing both ETF and index funds. We are the only ETF manager in Taiwan that holds off-shore advisory experience. We aim to expand to the rest of Asia with our indexing management capability. We are planning to increase our exposure to South Korea, Indonesia and other parts of Asia.

About Fubon Asset Management

Fubon Asset Management was established in 1992 and became a member of Fubon Financial Group in 2002. Fubon Asset Management is a well-known asset management company and has been one of the leading ETF issuers in Taiwan. Fubon Asset Management owns a total of 30 ETFs with total AUM more than USD$2.8 billion as of the end of January 2018.

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