Bridging Markets: Two ETFs Tracking Hong Kong, China Shares Debut in Saudi Arabia

In a significant step towards enhancing cross-border capital flows and financial connectivity, two exchange-traded funds (ETFs) tracking shares in Hong Kong and China have debuted on the Saudi Arabian stock exchange. The Albilad CSOP MSCI Hong Kong China Equity ETF and the SAB Invest Hang Seng Hong Kong ETF mark a milestone in the growing ties between Asia and the Middle East.

The debut of these ETFs reflects the Saudi Arabian government's financial reform agenda, which aims to diversify the country's economy away from oil. By expanding the range of investable assets, these ETFs cater to the growing demand for diversified portfolios among Saudi investors. The Albilad CSOP MSCI Hong Kong China Equity ETF, managed by Albilad Capital and CSOP, invests in the top 30 securities listed on the Hong Kong Stock Exchange, providing exposure to sectors like consumption, healthcare, and technology. The SAB Invest Hang Seng Hong Kong ETF, launched by SAB Invest, offers exposure to the Hang Seng Index, further diversifying investment opportunities.


These ETFs not only broaden investment options for Saudi Arabian investors but also contribute to the kingdom's risk diversification. By gaining exposure to the dynamic Hong Kong and Chinese markets, investors can tap into the growth potential of these sectors while mitigating the risks associated with a single market exposure. Furthermore, these ETFs provide a hedge against currency fluctuations, as they are denominated in Riyals, reducing the impact of exchange rate volatility on Saudi investors' portfolios.


The debut of these ETFs also facilitates cross-border capital flows and enhances financial connectivity between Saudi Arabia and Asia. These ETFs, with initial sizes exceeding $1.2 billion and $10 billion respectively, offer investors in the Middle East direct access to the dynamic and diverse Chinese economy. This development follows the launch of Asia's first ETF tracking shares listed in Saudi Arabia in Hong Kong last November, further bolstering the evolution of Hong Kong's capital market as a global financial hub.

In conclusion, the debut of two ETFs tracking Hong Kong and China shares in Saudi Arabia aligns with the kingdom's financial market development strategies and international collaborations. These ETFs offer investors in Saudi Arabia direct access to the growth potential of China's diverse economy, further strengthening financial ties between the two markets. By providing convenient investment channels for investors from the Middle East to access Hong Kong and Mainland Chinese markets, these ETFs promote a two-way flow of capital, fostering stronger connections in capital markets and creating a win-win situation for both sides.