Invest

3067 vs 3033 – Which Should You Choose?

3067 vs 3033

Last updated on June 6th, 2021

There are many Hang Seng Tech ETFs that are listed on the Hong Kong Stock Exchange.

How does 3067 and 3033 compare with each other?

The difference between 3067 and 3033

Both 3067 and 3033 track the Hang Seng Tech Index. While 3067 is managed by BlackRock and 3033 is managed by CSOP, their main difference lies in the expense ratio you’ll incur (0.25% vs 1.05%).

Here is an in-depth comparison between these 2 ETFs:

Fund manager

3067 is managed by BlackRock, while 3033 is managed by CSOP Asset Management.

CSOP Asset Management is a regulated Chinese asset manager that was founded in Hong Kong.

3067 was started in September 2020, while 3033 started in August 2020. As such, both of these ETFs are relatively new.

Index tracked

Both 3067 and 3033 track the Hang Seng Tech Index.

This index represents the 30 largest technology companies listed in Hong Kong.

To be included in this index, companies have to:

  1. Have a high business exposure to technology themes
  2. Pass the index’s screening criteria

These companies all originate from Greater China, and they have to be listed on the Main Board of the HKEX.

They will also have to meet at least one of the 3 criteria below:

  • Technology-enabled business (e.g. via internet / mobile platform)
  • R&D Expense to Revenue Ratio ≥ 5%
  • YoY Revenue Growth ≥ 10%

Here are some of the top holdings of this index:

Hang Seng Tech Index Holdings Dec 2020

This index was also created very recently in July 2020.

Both ETFs would hold the same stocks in the same proportion. As such, their performance should be very similar.

Exchange listing

Both 3067 and 3033 are listed on the HKSE. However, they do have some differences:

Minimum units to purchase

You are required to purchase a minimum of 100 units of 3067 on the HKEX.

3067 Minimum Number Of Units

Meanwhile you require a minimum of 200 units to invest in 3033.

3033 Tiger Brokers

This difference in lot size is most likely due to the difference in unit price. 3067 costs almost twice as much as 3033.

3033 also has twice the minimum number of units to invest in. As such, both ETFs will have around the same minimum investment amount!

Even though both ETFs have different unit prices, it does not really matter in the end.

You can consider using Tiger Brokers to invest in the HKSE as it offers a minimum of 15 HKD per trade.

Dividend distribution

The dividend distribution of both ETFs is slightly different. 3067 aims to distribute any dividends semi-annually.

3067 Dividend Distribution

Meanwhile, CSOP intends to distribute your dividends annually in December.

3033 Dividend Distribution

However, these distributions are not guaranteed!

This is because most of the stocks in the index are tech stocks. They are aggressive growth stocks that would reinvest most of the profits into their company.

That way, these companies will continue to experience high amounts of growth!

Since the stocks themselves are not distributing dividends, the ETFs can’t distribute dividends to you either.

As such, you should not expect to receive any dividends when investing in this ETF!

Expense ratio

On top of the trading commissions you’ll need to pay the broker, you will have to pay an expense ratio to the fund manager as well.

The expense ratio is charged by the fund manager to cover the costs of running the fund.

Based on the value of your assets in the fund, you will be charged an annual fee.

Here are the expense ratios for these 2 funds:

30673033
Expense Ratio0.25%1.05%

The expense ratio for 3033 is only an estimate since the fund has just been newly set up.

When you compare the 2 expense ratios, 3067 has a much lower cost!

However, both of their expense ratios are higher than most S&P 500 ETFs which usually cost less than 0.1%.

BlackRock set up 3067 a few months later than 3033, but was still able to greatly reduce the expense ratio.

One reason why this is so is that BlackRock is the more established fund manager. They have around $8.7 trillion worth of assets under management!

In contrast, CSOP only has around $30 million USD worth of assets under management.

As such, BlackRock has a larger economies of scale. This could possibly result in the lower expense ratio being charged.

Average trading volume

If you are looking to actively trade using these ETFs, you may want to look at their liquidity. One of the indicators you may want to look at is the ETF’s trading volume.

Since both funds are rather new, Yahoo Finance does not have enough data to calculate the average trading volume.

30673033
Trading Volume9 million24 million

It is interesting to see that 3033 is the ETF that is traded more frequently, even though it has a higher cost!

Both ETFs have a relatively high trading volume. As such, you will be able to buy or sell your units at your intended price.

Verdict

Here is a breakdown between 3067 and 3033:

30673033
Index TrackedHang Seng Tech IndexHang Seng Tech Index
Fund ManagerBlackRockCSOP
ExchangeHKEXHKEX
CurrencyHKDHKD
Estimated Unit PriceHKD20HKD10
Minimum Units
to Invest
100200
Dividend DistributionSemi-AnnuallyAnnually
Expense Ratio0.25%1.05%
Trading Volume9 million24 million

So which ETF should you choose? The choice is rather clear since 3067 has a much lower expense ratio.

When you are investing in 2 ETFs that track the same index, the performances will be very similar.

The performance may only differ slightly due to the tracking error of the fund.

To calculate your net returns, you’ll need to subtract off any of the costs incurred. The extra 0.8% that you’re paying for 3033 may come to hurt you, especially in the long run!

Conclusion

Both 3067 and 3033 should have very similar performances since they track the same index. However, the huge difference in expense ratios may ultimately affect your net returns!

As such, 3067 should be the more preferable ETF to invest in.


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