ETF Q & A

  1. How are offshore ETFs listed on Taiwan Stock Exchange?
      The offshore ETFs can be listed on TWSE by either of the following methods:
    • (1) Cross Listing
      • Also known as dual listing. The issuer of offshore ETF is required to appoint a master agent to file a listing application. Specifically, the master agent shall timely disclose information on MOPS and submit necessary documents to Taiwan Stock Exchange. Through cross-listing, Taiwan investors can directly trade offshore ETFs.
    • (2) Feeder ETF
      • A domestic asset management company issues a new ETF, called a feeder ETF, which conducts almost all of its investing through an offshore ETF. A feeder ETF allows Taiwan investors to indirectly invest into an offshore ETF. The feeder ETF shall be regarded as a type of domestic ETFs but containing foreign securities.

        The ETFs listed on Taiwan Stock Exchange could be classified as follows:
    The comparison among Offshore ETF, Feeder ETF, and pure Domestic ETF.
      Offshore ETF Domestic ETF
    ETF comprising foreign securities
    (Feeder ETF included)
    ETF comprising only domestic securities
    Issuer Foreign issuer, and introduced by a master agent Domestic issuer Domestic issuer
    Management fee Charged by foreign issuer Charged by both foreign issuer and domestic issuer Charged by domestic issuer
    Trading unit Same as in primary exchange, e.g. 100 units or 200 units 1,000 units 1,000 units
    Maximum price fluctuation No limit No limit 7%
    Quotation currency Taiwan dollar
    Trading venue Any brokerage
    Automated instructions on dollar-cost averaging N/A N/A Available in chartered institutions
    Settlement period T+2 days
    Transaction fee Negotiable, with the ceiling of 0.1425%
    Transaction tax 0.1%, levied on sell side only
    Dividend income tax Exempted Exempted Payable
    Capital gains tax N/A
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