Samsung to list first futures-based ETFs in HK

Samsung Asset Management is set to list the first two futures-based exchange-traded funds (ETFs) in Hong Kong tomorrow, AsianInvestor can confirm.

The Korean company, which had $112 billion in assets under management as of the end of last year, will be at the Hong Kong exchange tomorrow to list the Kodex HSI Futures ETF and the Kodex HSI Futures RMB foreign exchange ETF.

The former is a Hong Kong dollar-denominated product that will track the performance of the HSI Futures Index, while the latter is RMB-based and will correspond to the HSI Futures RMB FX Index.

Samsung AM is understood to have contacted Hong Kong's Securities and Futures Commission (SFC) about the possibility of listing futures-based ETFs on the city's main bourse as much as two years ago.

The combined fundraising target for the two products is $70 million, aimed predominantly at retail investors but also institutions. The custodian is HSBC.

A source told AsianInvestor that the SFC had been initially reluctant to grant approval to futures-based ETFs, and that Samsung AM engaged the regulator in research efforts on the market.

Samsung AM is the leading provider of ETFs in the Korean market by value. Overall Korea has 172 ETFs accounting for $17.9 billion in assets as of the end of last year. Samsung has 36 products with $10.5 billion in assets.

The firm listed the first ETF on the Korean stock exchange in October 2002 (Kodex 200). Subsequently it has launched a number of domestic firsts, including the first fixed income ETF (2009), and the first inverse (2009) and leveraged (2010) products.

It maintains a leading position in Korea with around 90% of ETF trading volume, according to company documents. Currently it offers 20 physically-backed ETFs, nine futures-based ETFs and five synthetic ETFs.