UBS AM Lists UBS MSCI Hong Kong UCITS ETF on London Stock Exchange

UBS AM : The UBS MSCI Hong Kong UCITS ETF, identified by the ISIN LU1169827224, has been listed for trading on the London Stock Exchange.

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By ETFWorld.co.uk

André Mueller, Head of Client Coverage at UBS Asset Management

The fund provides investors with a passive, rules-based investment strategy targeting the Hong Kong equity market.

ETF Overview and Strategy

The fund’s objective is to track the performance of the MSCI Hong Kong Index (Net Return) before accounting for expenses. This index comprises large and mid-capitalization stocks listed in Hong Kong.

The ETF is passively managed and employs a physical replication strategy. It aims to hold all, or substantially all, of the index’s component securities. The fund’s documentation states that it may also use derivatives in specific circumstances, such as when direct replication is not practicable or to generate efficiencies. The portfolio manager has the discretion to hold securities outside the index if deemed appropriate for meeting the fund’s objective.

The fund engages in securities lending, a practice that can generate additional revenue but introduces counterparty risk. This risk is managed according to UBS’s collateral policy. It is classified as a UCITS fund, domiciled in Luxembourg, and has a distributing policy, paying dividends semi-annually.

Portfolio Composition and Sector Concentration

The ETF’s portfolio is highly concentrated. Over 93% of its assets are invested in Hong Kong, with minor exposures to Bermuda and Macau. This geographic focus leads to heavy sector tilts.

The portfolio is dominated by the Financials sector, which accounts for 49.73% of holdings. Real Estate is the second-largest sector at 16.62%, followed by Industrials at 13.58%.

The top ten holdings constitute roughly 71.67% of the portfolio, indicating high single-stock concentration. The largest positions are:

• AIA Group Ltd. (25.82%)

• Hong Kong Exchanges and Clearing Ltd. (15.38%)

• CK Hutchison Holdings Ltd. (4.65%)

The fund’s base currency is the Hong Kong dollar (HKD), and the listed share class is unhedged, meaning investors are directly exposed to currency fluctuations between the HKD and their local trading currency.

Source: ETFWorld