According to mutual fund firm China Asset Management Co (ChinaAMC), China’s exchange-traded funds (ETFs) have experienced an annual net inflow of over 400 billion yuan ($55.97 billion) this year, setting a record for annual net inflows. Investors looking for greater value in exchange-traded funds (ETFs) have resulted in net withdrawals of approximately 360 billion yuan from active equities and allocation funds. As active fund managers find it difficult to turn a profit, passive investment has become more popular. This year, an index that tracks China’s active equities funds fell by about 12%.
Between January and September, China’s stock exchange-traded funds had a 33% increase in total assets under management, reaching 1.48 trillion yuan, or around $209 billion. ETFs have become more and more popular as Beijing begins purchasing blue-chip ETFs from sovereign wealth funds like China’s Central Huijin Investment in an effort to stabilise the stock market.
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