| As one of the whole new financial products the ETF is a new fund product popularized most by the foreign investors. The history of the developing of the ETF product if not very long, but the speed of it is surprising. As in the United States for example from the end of 1993 to the end of 2003, the asset of the ETF fund increased from $464 million to $150.983 billion, 23 fold of the start scale; simutinously, the number of the fund increased from 1 to 119. At the end of 2003 there are 281 ETF's products totally in the world and the asset scale had up to $211 billion. In recent years with the constant and healthy development of the national economy, there are a series of pleased achievements has been made in our stock market. The development of the market makes a poweful basis of the innovation of the securities, and needs more and more financial products to meet the financial demands of the crowds of investors eargerly. As the first ETF product in the securities market in China Inland 50 ETF of Shang Hai Stock Exchange has growed rapidly in the number of the group of investors in the value investment and promoting the investment value of the market. The 50 ETF of Shang Hai Stock Exchange selects the 50 index of Shang Hai Stock Exchange as its target. The component stocks of the 50 index of Shang Hai Stock Exchange is composed by the group of public companies most valuable to investment, which are highly cognitional to the public and representative of the general. So in a long time in the future the 50 ETF index of Shang Hai Stock Exchange has the advantage in the asking to purchase and ransoming, the market promotion, the arbitrage, investment management and the cooperating with the future financial derivative of the fund. The 50 ETF of Shang Hai Stock Exchange selects the IPO model in its first issuing, which has good effects on attracting all kinds of investors to participate in. Under IPO model all the institutions investors and private investors can suscribe funds with cash or through share values (limited to the 50 stocks in Shang Hai Stock Exchange). After the fund is founded the manager would gradually complete opening a position, the asking to purchase and ransoming would start up which would take the market basket plan. The fund managers provide the list of the asking to pruchase and ransoming to the Shang Hai Stock Exchange every working day to ensure the ammount of the basket of the shares and the proportion of the cash. The investors should prepare sufficient ammount of ralative shares and cash for asking to purchase and sufficient fund shares and cash for ransoming. Analyse the reason of the tracking error of 50 ETF of Shang Hai Stock Exchange especially the reason of the downwards diviation could help the investor make correct investing dicision, and, more importantly, could help the fundmanager find out the main factors which result in tracking error to adopt some methods to reduce the deviation, avoid the risks, and reach the expected investing return of ETF. The factors resulting in deviating of 50 ETF of Shang Hai Stock Exchange from the index mainly are period cost, such as management cost, custodian cost, etc., all kinds of trading cost, duplicating deviation, devidends and the cash encumbered with cash alternative. In the securities market in our country one of the reasons caused tracking error is that the fund participates in the ration merchandise for sale of the new stock. Because of the existing of the factors caused the fund's tracking error in the actual working process the fund manager should notice the active management risk and prevent the fund investment portfolio deviating the exponent index. Right because the existing of the active management risk the ETF appears the tracking error. If the fund manager ensures that the active management risk is controlled in a limited area in running of the fund the fund's actual tracking error would be very small. The arbitrage trading is one of the most important show of the ETF lifepower. Especially in the securities market in our country there is no bearing system the ETF arbitrage trading provides a new profit model. The opportunity of arbitrage will appear when the price in the secondary market deviates from the unit asset of the fund. Efficient arbitraging can reduce the degree of the discount or premium of ETF rapidly to reduce a large degree of the rate of the discount or premium and converge it to ETF's net asset at last to reach the propriate pricing posistion of ETF. If new changes in the ralationship of the demand and supply happens to result in ETF's another discount or premium, the arbitrage will appear once more and make the price converge to the ETF's net asset rapidly and efficiently, and such dynamic circulation will go on and on. This is the pricing system and arbitraging system designed to 50 ETF of Shang Hai Stock Exchange. As a innovative financial instrument the 50 ETF of Shang Hai Stock Exchange is a high efficient and multi-functional investing weapon using which the investors can make capital allocation, long-term investment, stock reinvestment, opportunity choosing, waveband operating, gaining the arbitrage and day trading. In the future with the development and improvement of the policy the 50 ETF can also become the investing object of other funds or the present products of financial derivative instruments. As the first ETF product in the stock market in China Inland the situation of 50 ETF since its listing on the stock market shows that this innovative product has gained its success in the expeircing test. But n the same time we also saw that there are some problems in 50 ETF and the main is that the very smaller capital scale,the less opportunity of arbitrage, the higher start point,the room for improvement in trading system, the operating risk and the method of closing a position of individual institution. If ETF wants to have any success in the securities market in China Inland as a whole new financial product the present-running legal system, the market conditions and the technical conditions,etc., should be improved constantly.
|
PDF Full Text Request