NEW YORK, May 31, 2018 /PRNewswire/ -- Krane Funds Advisors, the investment manager for KraneShares exchange traded funds (ETFs) announced the launch of the KraneShares MSCI China A-Share Collective Fund, a Collective Investment Trust (CIT).
The CIT seeks to replicate the performance of its benchmark, the MSCI China A Inclusion Index, which is designed to track the progressive partial inclusion of Mainland listed Chinese securities (A-shares) in the MSCI Emerging Markets Index over time.
The CIT follows the same investment strategy as the KraneShares Bosera MSCI China A-Share ETF (KBA). KBA has the longest track record and is the largest MSCI-linked China A-share ETF in the United States by assets under management1.
The trustee for the new CIT is SEI Trust Company, a wholly owned subsidiary of SEI Investments Company (SEI), a leading global provider of institutional and private client wealth management solutions. SEI maintains ultimate fiduciary authority over the management of, and the investments made in, the CIT with Krane Funds Advisors, LLC as advisor.
The KraneShares MSCI China A-Share Collective Fund was developed specifically for qualified pensions including defined benefit and defined contribution plans, and complies with the fiduciary standards of the Employee Retirement Income Security Act (ERISA).
"This is a significant moment for China's capital markets and for global institutional investors who begin to allocate their portfolios to the world's second largest equity market," said Jonathan Krane, CEO of KraneShares. "We believe this CIT is a solution for institutional retirement plans that track MSCI indexes to align with the benchmark as they incorporate the China A-share market into their portfolios."
Plan sponsors or advisers who would like further information about the CIT, including a copy of the Declaration of Trust, should call +1 (212) 933 0393.
About the MSCI China A-Share Inclusion
MSCI, is a leading global index provider with $13.9 trillion benchmarked assets2 and $1.6 trillion tracking the MSCI Emerging Markets Index alone3. Over the long-term China A-shares are projected to comprise 17% of the MSCI Emerging Markets Index spanning multiple rebalances4 which could raise China's total weight from 30% to over 40% over the next several years4. This could represent upward of $270 billion being reallocated to the newly included A-share securities4. Similar past rebalances have provided a strong catalyst for the performance of the inclusion markets.
Krane Funds Advisors, LLC is the investment manager for KraneShares ETFs, with a five-year track record advising China-focused strategies, across 11 ETFs in the United States and Hong Kong totaling $2.2 billion in assets5. The firm is among the most experienced managers in the United States at trading China A-shares through the Shanghai and Shenzhen / Hong Kong Stock Connect Programs, launched in November 2014 and December 2016 respectively.
Krane Funds Advisors, LLC is majority owned by China International Capital Corporation (CICC) a leading full-service Chinese investment bank founded by China Construction Bank and Morgan Stanley in 1995 as the first Sino-US joint venture investment bank. CICC listed on the Hong Kong Stock Exchange in 2015 (ticker 3908.HK) and is majority owned by China Investment Corporation (CIC), the second largest sovereign wealth fund globally with over $900 billion AUM6.
CICC has 6,746 employees7, 129 research analysts8 over 200 branches across Asia, Europe and the United States7. In 2017, CICC ranked as the top firm for the sixth year in a row in Institutional Investor's All-China Research Team category8.
Now in its 50th year of business, SEI (SEIC) is a leading global provider of investment processing, investment management, and investment operations solutions that help corporations, financial institutions, financial advisors, and ultra-high-net-worth families create and manage wealth. As of March 31, 2018, through its subsidiaries and partnerships in which the company has a significant interest, SEI manages, advises or administers $869 billion in hedge, private equity, mutual fund and pooled or separately managed assets, including $335 billion in assets under management and $530 billion in client assets under administration. For more information, visit seic.com.
SEI Trust Company serves as the Trustee of the Fund and maintains ultimate fiduciary authority over the management of, and the investments made, in the Fund. The Fund is part of a CIT operated by the Trustee. The Trustee is a trust company organized under the laws of the Commonwealth of Pennsylvania and a wholly owned subsidiary of SEI Investments Company (SEI).
- Data from Bloomberg as of 4/30/2018
- As of December 31, 2017, as reported on March 31, 2018 by eVestment, Morningstar and Bloomberg.
- Data from MSCI as of June 30, 2017, as reported on September 30, 2017 by eVestment, Morningstar and Bloomberg
- "EVOLUTION OF CHINA A SHARES & MSCI CHINA A INCLUSION INDEX" MSCI, 4/23/2018
- AUM as of 5/18/2018
- Data from the Sovereign Wealth Fund Institute as of 4/30/2018
- Data from Bloomberg retrieved May 18, 2018
- Allen T. Cheng, "CICC Voted No. 1 in China Research, Sales", Institutional Investor 11/15/2017. Retrieved 5/18/2018