Roundhill Investments is looking to replicate the success of its Magnificent Seven ETF (MAGS) in China.
The company’s CEO, Dave Mazza, plans to launch the Lucky Eight ETF, which aims to be China’s answer to the success of Wall Street’s big tech stocks.
“There are a lot of question marks about the Chinese economy and the growth potential of consumers in China,” Mazza told CNBC’s “ETF Edge” on Monday. “Ultimately, we believe investors are looking for exposures that offer them precision, just as we found with MAGS.”
The Lucky Eight ETF trades under the ticker symbol “LCKY” and includes equal-weighted exposure to Tencent Holdings, Ali Baba, Meituan, BYDXiaomi, PDD holdings, JD.com And Baidu at the start. According to Roundhill’s May 17 SEC filing, these names were chosen because of their “market dominance in technological innovation.”
“Particularly as they come out of an economic slowdown, this could be an opportunity for investors to get into China and do it with the names that really matter,” Mazza said.
While existing exchange-traded funds like the KraneShares CSI China Internet ETF Mazza offers broad exposure to Chinese technology and hopes to allow investors to focus on just a few key names in the space.
“I’m a big believer in broad diversification of large portions of a portfolio,” Mazza said. “But if you just want those names, it’s hard to get them with some traditional Chinese ETFs. And this will do that.”
Pending SEC approval, the Lucky Eight ETF is expected to launch this summer.
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2024-05-22 23:00:01
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