You recently had your products listed on Xetra. Why did you choose Xetra?

As one of the largest ETF markets in Europe, KraneShares believes Germany as a key strategic growth market for the firm. We are seeing an increase in client demand for investments in China and Climate and are committed to helping them take advantage of investment opportunities from the Chinese equity market. Xetra is Germany’s leading stock exchange, offering us access to a broad range of investors and exposure to a diverse and liquid market. As KraneShares looks to expand its presence in the European market, listing on Xetra will help achieve a strong foothold in the region. At the same time, KraneShares is also delighted to offer innovative China and climate solutions for German investors which complement other ETFs on the Xetra platform.

What distinguishes your newly listed products?

KraneShares specializes in thematic and climate-related ETFs with a focus on investing in China and global themes where China plays a significant role. KraneShares offers 7 UCITS ETFs for German investors that span themes such as China internet, electric vehicles/future mobilities, clean technology, mainland Chinese A-Shares, Chinese ESG, innovative technologies, and more.

KraneShares UCITS ETFs deliver the following core attributes:

• Access to the second-largest economy in the world
• Meaningful source of global diversification to enhance portfolio construction
• China's thematic investment opportunities for growth
• Opportunities from China's Internet and E-Commerce sector – the most prominent Internet and consumer population globally
• Clean technology opportunities, including electric vehicles, battery manufacturing, solar, and wind
• Investment opportunities from the global clean energy transition

KraneShares UCITS ETFs offer a combination of strategic and tactical asset allocation solutions to complement international investors’ portfolios.

Which major trends do you think will shape the ETF landscape in the next few years?

With China being the second largest economy in the world, KraneShares is convinced that China is an asset class in its own right, and as such, a well-balanced China portfolio will be an important component in overall asset allocation for European and global investors.

We believe several potential key catalysts could benefit Chinese markets in the long term. With the Chinese government’s urbanisation goal, we will expect to see millions of the population migrating to cities in the next decades to come. We believe sectors benefiting directly from Chinese consumer spending will drive domestic economic growth. China's urban population, the world's largest consumer base, makes China well-positioned for economic growth as it shifts its focus toward boosting domestic demand.

China plans to hit peak carbon emissions before 2030 and reach carbon neutrality by 2060. This commitment was emphasized in China’s 14th Five-Year Plan in 2020. The electric vehicle (EV) sector has already witnessed a surge in consumer interest and is poised for continued growth. Chinese EV makers have reported robust sales figures, partly due to incentives for achieving China’s carbon goals. We believe clean technology companies in electric vehicles, batteries, solar and wind will have a multi-year growth opportunity from this transition with the added benefit of being uncorrelated to the macropolitical environment.

(The interview was held with Dr. Xiaolin Chen, Head of International, KraneShares)