KraneShares CSI China Internet UCITS ETF (LSE: KWEB) Surpasses USD $175 Million in Assets Under Management and Adds Securities Lending
London, U.K. 1 October 2020 – Krane Funds Advisors, LLC, (“KraneShares”), a global asset management firm known for its China-focused exchange-traded funds (ETFs) and innovative China investment strategies, announced today that the KraneShares CSI China Internet UCITS ETF (LSE: KWEB) surpassed USD $175 million in assets under management (AUM) since launching in November 2018. The increase in AUM comes as KraneShares launched a securities lending program to benefit KWEB’s investors.
KWEB seeks to capture the compelling growth potential of China’s leading, innovation-driven internet companies. The fund tracks the CSI Overseas China Internet Index, the same benchmark and strategy as KraneShares’ flagship New York Stock Exchange-listed China internet ETF, which has a seven-year track record and $2.8 billion in assets under management.1
“Surpassing USD $175 million in AUM is a major achievement for the KraneShares CSI China Internet UCITS ETF,” said Jonathan Krane, CEO of KraneShares. “This milestone coincides with the launch of securities lending on KWEB’s holdings, which we believe makes KWEB more attractive to European and U.K. investors.”
For UCITS* ETF investors, funds with securities lending programs offer the added benefit of an additional income stream. When the securities-lending income stream is juxtaposed against the management fee, the overall cost of ownership of a UCITS ETF can be thought of as being significantly reduced given the general offsetting economic impact of income versus fees.
KraneShares’ three additional UCITS funds, listed below, have also entered into a Securities Lending Agency Agreement with Brown Brothers Harriman & Co. (“BBH”) as Lending Agent:
- KraneShares’ KraneShares MSCI China ESG Leaders UCITS ETF (LSE: KESG)
- KraneShares MSCI China A-Share UCITS ETF (LSE: KBA)
- KraneShares Bloomberg Barclays China Bond Inclusion UCITS ETF (LSE: KBND)
Up to 50% of KWEB’s assets can be lent out. Currently, 90% of net securities lending income earned is distributed directly to investors via the share price – a percentage that can only increase as KraneShares assets grow. Regardless of a security being on loan, the UCITS ETF’s value includes that of the underlying security. All of the UCITS ETF’s corporate action elections and income are protected for shares on loan. The income earned from securities lending is estimated and accrued daily into the ETF’s NAV and is distributed on a monthly basis.
“KWEB’s impressive AUM growth speaks to European and UK-based investors’ appetite for innovative China investment strategies,” said Dr. Xiaolin Chen, Head of KraneShares International. “We are always looking for ways to enhance the client experience. We believe the income provided from securities lending will benefit investors and make our funds even more attractive.”
Krane Funds Advisors, LLC is the investment manager for KraneShares ETFs. The firm is focused on providing investors with strategies to capture China’s importance as an essential element of a well-designed investment portfolio. KraneShares ETFs represent innovative, first to market strategies that have been developed based on the firm and its partners’ in-depth knowledge of investing. These strategies allow investors to stay current on global market trends and provide meaningful diversification. Krane Funds Advisors, LLC is majority-owned by China International Capital Corporation (CICC).
*UCITS: Undertakings for Collective Investment in transferable Securities
1. Data from KraneShares as of 9/8/2020