Impact of Structure

Let’s go through some examples of structural differences and examine impact on the actual fund.

Example: Derivative Based versus Physical Replication in Registered Investment Company (RIC) ETFs

China has historically been one of the more difficult markets to access for foreign investors. Securities listed on the Chinese stock exchanges are primarily categorized into A-shares or B-shares. A-shares are only open to investment by Chinese citizens. B-shares are open to foreign investors but have traditionally consisted of less desirable and limited offerings. Hong Kong–listed Chinese securities fall primarily into the H-share class. Those shares are open to all ­investors, but listings comprise only the largest and most ­global-facing ...

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