HONG KONG, Oct 19 (Bernama-BUSINESS WIRE) — CSOP Asset Management Limited (“CSOP”) is happy to announce the listing of CSOP CSI Brokerage Index Daily (2x) Leveraged Product (ticker: 7252.HK) on Hong Kong Stock Exchange. 7252.HK aims to help investors capture the short-term investment opportunities of China brokerage sector of A Shares. Tracking CSI All Share Investment Banking & Brokerage Index (the “Index”), 7252.HK intends to adopt a swap-based synthetic replication strategy to achieve the investment objective, which is 2x performance of the index on a daily basis. With listing price at around HKD 7.8 per unit, trading lot of 100, CSOP CSI Brokerage Index Daily (2x) Leveraged Product will start to trade on 19 October, 2022. Upon listing, 7252.HK has received USD 5 million, HKD 39 million equivalent initial investment.
As the direct beneficiary of the bull market, China brokerage (“brokerage”) sector is highly correlated to China A Shares performance. In a bull market, brokerage sector will be boosted by the growth of its major business of brokerage, proprietary investment, security lending, asset management, IPO, etc. tending to deliver an amplified performance of the China A Shares. According to historical data, in previous major market recoveries, the brokerage sector was always the first to rebound as the bull market indicator and outperformed the Shanghai Composite Index and CSI300 by a large margin. In the 2014-2015 bull market, the CSI All Share Investment Banking & Brokerage Index accumulated a gain of over 250%, almost 2 times of Shanghai Composite Index and CSI300 index respectively1. The amplified performance and higher volatility of China A Shares brokerage sector in a bull market implies short-term trading opportunities for tactical investors. Worth noticing, as of 26 September, 2022, the price-to-book ratio (P/B) of the sector is only 1.16, while the valuation of some head brokerages is close to or even below 1x P/B, which is at the bottom of history2, potential market recovery implies investment opportunities.