Metaverse investment enters mainstream as CSOP’s exchange-traded fund debuts in Hong Kong to pick winners in next-generation web
- Hong Kong fund manager CSOP will list the first ETF in Hong Kong that invests in US stocks linked to the metaverse
- South Korean investors have piled into metaverse ETFs, which pick potential winners in the race to the next generation of the web
Trading in Hong Kong under the mnemonic “3034,” the actively managed fund will list at HK$7.80 per unit, for a board lot of 100 units. The fund’s manager actively buys and sells stocks from the portfolio, instead of tracking its performance against a benchmark like passive ETFs, CSOP said.
“As the technologies involved in the development of the metaverse are ever changing, an actively managed ETF is more suited to investing in the metaverse,” said CSOP’s director Kenneth Lee, during a Friday media briefing hosted on Roblox platform for virtual events and avatars, adding that the active ETF will undergo more frequent reviews than passive funds.
The ETF will invest in US-listed stocks, including American depositary receipts (ADRs), that belong to four categories in the metaverse infrastructure: chip and telecoms network companies, engineering stocks such as display makers, application developers and content providers.
The ETF received US$9 million in investments from subscribers when it was opened last week to initial subscriptions.
The global metaverse market is likely to see an explosive growth over the next decade, ballooning to US$1.5 trillion in value by 2030, from US$5 million in 2020, CSOP said, citing data from Bloomberg and PwC.
South Korea has been Asia’s pioneer in metaverse investments, with eight such ETFs and US$1.1 billion in assets under management (AUM) listed on the Korea Exchange last year, according to Morningstar’s data.
Mirae Asset Global Investment and Samsung Asset Management are among the most active managers of metaverse-related ETFs, where growth has been driven by demand by retail investors. Hong Kong’s investors are unable to invest in the South Korean market, said Samsung Asset Management’s ETF management team head Jaewook Chung.
