KraneShares Adds China Internet-Themed ETF

ETF Trends

New exchange traded fund player KraneShares added another China-related fund strategy Thursday focused on the growing Chinese Internet industry.

According to a press release, the KraneShares CSI China Internet ETF (KWEB) will track the performance of the CSI Overseas China Internet Index, which includes Chinese Internet and Internet-related companies. KWEB has a 0.68% expense ratio.

The underlying index will hold about 20 to 30 different securities. China Internet companies include those that develop and market internet software or provide Internet services; manufacture home entertainment and educational software for home use; provide retail or commercial services through the Internet; and develop and market mobile Internet software or provide mobile Internet services.

“KraneShares CSI China Internet ETF provides US investors with an opportunity to gain exposure to China’s growing internet sector with the cost efficiencies of ETF investing,” Brendan Ahern, Managing Director of KraneShares, said in the press release. “We see two powerful demographic trends driving China’s internet sector: since 2000, internet spending by urban Chinese has increased 14% annually, and China’s rural population continues to migrate to urban areas, further fueling internet usage.”

The China Internet-themed ETF can help investors capitalize on the emerging middle class and growing Internet usage in mainland China.

“We believe the China Internet sector offers an excellent opportunity for US investors,” Dr. Zhigang Ma, General Manager of China Securities Index Co., said in the press release. “There are approximately 600 million internet users in Mainland China. Chinese internet company market capitalizations now rival the largest US and global industry leaders, along with the potential for Chinese internet IPOs to come later this year, this is definitely a sector that warrants attention.”

The KraneShares ETF could be competing against the Guggenheim China Technology ETF (CQQQ) and the Global X China Technology ETF (QQQC) .

KraneShares also has a number of other China sector-related ETFs filed with the SEC, including consumer staples, consumer discretionary and urbanization themes,

The company recently came out with the  KraneShares CSI China Five-Year Plan ETF (KFYP) that focuses on companies in targeted sectors of China’s 12th Five-Year Plan. [A Quirky New China ETF]

For more information on new fund products, visit our new ETFs category.

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

View Comments