HSBC has listed a broad emerging markets ETF on the London Stock Exchange as it continues its focus on providing emerging markets access to its clients.
The ETF tracks the MSCI Emerging Markets Index, which is seen as a benchmark for emerging markets exposure. It includes stocks from Latin America, Asia, emerging Europe, Russia and South Africa. The ETF, like all others offered by HSBC, is physically-backed.
The listing brings HSBC's London offering to 25; the majority of its existing ETFs track emerging markets and HSBC has been committed to offering emerging markets exposure.
"We aim to provide a core set of ETFs that meet most investors' needs with a natural emphasis on emerging markets given that we are HSBC," says Farley Thomas, head of ETFs at HSBC. The motivation for launching each individual ETF is primarily in response to investor demand, he adds.
Although HSBC has focused its ETF offering on emerging markets it was (until now) lacking a broad emerging markets offering, having previously focused on single countries or groups of countries such as Bric (Brazil, Russia, India and China) or the Far East.
In future, Thomas says that the distinctions between developed and emerging markets are likely to change so it will no longer be as simple as dividing country exposure: "A big move on the way is that of challenging the concept of developed versus developing markets and looking at each individual economy and nation.
"A number of economies are still, to some extent closed, while others are well connected to either the developed world or other emerging markets... I believe investors will be looking more at this factor of interconnectedness of economies."
Eight-week high against US dollar
Lower cost option for advisers
Following 2016 thematic review
December 2018 or early 2019
Feasibility study due