Mirae Asset Global Investments Launches Leveraged Version of the China Electric Vehicle and Battery ETF Tracking Solactive Index ￼
In 2022, the electric vehicle market experienced explosive growth, with sales surpassing 10 million in 2022, according to the International Energy Agency’s (IEA) Global EV Outlook 2023 report. The document shows that China has taken the lead again, capturing approximately 60% of the global electric car sales – which was also backed by the government support. The country currently boasts over half of all electric vehicles on roads worldwide and it has already overdone its 2025 goal for new energy vehicle sales. Further addressing the strong growth in this segment – both domestically and overseas – that is projected to the upcoming years, Mirae Asset Global Investments (Mirae Asset) now launches the Mirae Asset Tiger Synth-China EV Leverage ETF, tracking the Solactive Daily Leverage 2x Long China Electric Vehicle and Battery Index. In addition to the widely popular unleveraged Mirae Asset TIGER China Electric Vehicle Solactive ETF, investors will now have the opportunity to invest into a new ETF that aims to provide a return twice (2x) the daily performance of the base index (Solactive China Electric Vehicle and Battery Index).
Leverage and Inverse (L&I) products have been rising in popularity. With higher interest rates, uncertain inflation scenarios, and geopolitical uncertainties, market volatility has also been increasing again. This situation sparks the necessity to reposition a portfolio more frequently and/or provide investors with opportunities to take advantage of their convictions. In this context for instance, leverage can help to achieve a higher tactical exposure to growth potentials in the China EV and Battery space.
The Solactive China Electric Vehicle and Battery Index includes the 20 largest China or Hong Kong-headquartered companies listed on HKEX, Stock Connect, as well as NYSE and NASDAQ, active in one of the following industries: electrical products, motor vehicles, auto parts: OEM, and industrial machinery among others. Additionally, the index may include companies operating in certain chemicals and industrial sectors.
The new Mirae Asset Tiger Synth-China EV Leverage ETF has been listed on 9 May 2023 on the Korean Stock Exchange, with stock code 456680:KS.
Timo Pfeiffer, Chief Markets Officer at Solactive, comments: “Automotive technology has come a long way in a short time and China’s drive to lead the way in various industrial sectors including EVs has provided a strong impetus for growth across multiple sectors in the country. Additionally, leveraged products are increasingly gaining importance for investors who want to pursue short-term market views to generate capital gains, increase diversification, or hedge their positions. We are very pleased that Mirae Asset has decided to launch another solution in the Electric Vehicle industry with us, which is yet again a testament to the successful partnership between Mirae Asset and Solactive.”
Ji-Yeon Kim, Senior Manager at Mirae Asset Global Investments, says: “China has a competitive advantage across the entire value chain of the electric vehicle industry, from key raw materials for batteries to complete vehicle assembly, as it has the ability to produce them all domestically. As the automotive industry undergoes a paradigm shift from internal combustion engine vehicles to EVs, the Chinese EV industry is expected to benefit and is considered to have long-term growth potential. The existing TIGER CHINA ELECTRIC VEHICLE SOLACTIVE ETF is the fourth largest ETF in terms of assets under management (AUM) among ETFs listed in the Korean capital market, and it has attracted the most attention from Korean investors. Therefore, launching the leveraged product that can be used for short-term trading purposes would provide the Korean investors with a new opportunity to maximize their returns.”