The Taiwan Monthly

Jul. 2024

Market & ETP Overview

Deepening Taiwan-Japan Cooperation, the TWSE and TIP participated in the 2024 S&P DJI Japan ETF Conference

To strengthen Taiwan-Japan exchange and cooperation, the Taiwan Stock Exchange (TWSE) attended the 16th S&P DJI Japan ETF Conference in Tokyo from June 4 to 5. TWSE participated as a panelist and, along with Taiwan Index Plus Corporation (TIP), set up a booth at the venue to promote Taiwan's capital market and the development of indexed investments to international institutional investors. Additionally, they met with the major exchanges and local asset management companies for business exchanges and discussed index cooperation opportunities with global index providers, resulting in a tight but fruitful schedule.

 

The TWSE stated that this conference is a significant global ETF event, annually inviting over a thousand experts from the industry, government, and academia, including Japan's Financial Services Agency, major exchanges, worldwide securities firms, and international asset management companies, creating an unprecedented grand occasion.

 

During the conference, the TWSE discussed the theme of "Expanding Passive Solutions to Meet Diversifying Investor Needs," sharing the latest developments in the Taiwan ETF market and interacting with S&P DJI and international asset management companies. The TWSE introduced that passive investment products like ETFs have become increasingly favored by investors in recent years. In March 2021, the asset scale ratio of Taiwan ETFs to mutual funds was approximately 37:63, which reversed to 61:39 in March 2024. The booming retail investor market in Taiwan's ETFs is attributed to key factors such as TWSE's long-term collaboration with regulatory authorities, the Securities Investment Trust & Consulting Association, industry players in promoting investor education, providing a friendly trading environment, and establishing a one-stop platform.

 

TWSE also shared with attendees that Taiwan's ETF products are highly diverse, covering various industries, themes, strategies, and different asset classes such as stocks, bonds, commodities, as well as leverage and inverse ETFs for operation. In recent years, to support sustainable development, Taiwan has gradually expanded ESG-related ETF products, making it easier for investors to be more familiar with sustainable investment trends. Taiwan is currently exploring active ETFs and multi-asset ETFs by referring to global development experiences and the performance of domestic mutual funds, with the goal of developing a healthy overall market while ensuring investor protection. The TWSE is also negotiating with different countries for cross listing or feeder ETFs to promote greater diversified market development.

 

Additionally, the representatives at the conference expressed strong confidence in the continued growth of the global ETF market and will continue to enhance product innovation towards diversification and customization. The TWSE will also continue to enrich the types of underlying assets, promote active and multi-asset ETFs, expand the ETF product line, and drive the growth of Taiwan's ETP market.

 

Besides participating in the conference, the TWSE and TIP set up a booth at the venue to promote Taiwan's capital market, index investment, and new services, receiving enthusiastic responses and interactions.

 

The TWSE stated that it will continue to grasp international trends and adhere to mutually beneficial worldwide cooperation, closely connecting with various exchanges to strengthen financial innovation, deepen market promotion, and drive the growth of Taiwan's ETP market, building a more sustainable future for Taiwan's capital market.

For further information, please contact Ms. Chang at 1078@twse.com.tw.