The first exchange traded fund (ETF) on the Shenzhen Stock Exchange, one of the only two bourses on the Chinese mainland, will be available for investment beginning from Tuesday.

The Shanghai Stock Exchange issued China's first ETF a year ago.

The Shenzhen Stock Exchange said the 100ETF, under the custody of the Yifangda Fund Management Co. Ltd, will closely follow the Index 100 of the Shenzhen Stock Exchange, including the performance of China's blue-chip stocks, and stocks of some medium-sized and smaller businesses with good market performance.

Organizations including Shenzhen Stock Exchange will host a range of seminars in Chinese mainland cities such as Beijing, Shanghai, Shenzhen and Guangzhou to improve publicity on 100 ETF, said the sources.

The 100 ETF will be trade on the Shenzhen Stock Exchange after the issue is finished on March 17. Investors can swap their constituent stock shares of the Index 100 with the Shenzhen Stock Exchange for 100ETF between March 13-17 .

An exchange-traded fund, or ETF, is a type of investment company whose investment objective is to achieve the same return as a particular market index. An ETF is similar to an index fund in that it will primarily invest in the securities of companies that are included in a selected market index. An ETF will invest in either all of the securities or a representative sample of the securities included in the index.

ETFs are legally classified as open-ended companies or Unit Investment Trusts (UITs), but they differ from traditional open-end companies and UITs.

Source: Xinhua