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Taiwan ETFs – growing in global stature
A buoyant stock market, a supportive policy backdrop, and an investor preference towards ETFs, makes Taiwan a compelling market for international issuers.
Taiwan’s stock market is rapidly growing in global stature. And its increased importance is attracting the attention of international asset managers looking to issue products in one of the world’s fastest growing ETF markets1.
All these developments are underpinned by Taiwan’s unique position in the supply chain for advanced semiconductors, as enormous levels of AI-related demand for high-end chips is supporting robust economic growth. The island’s GDP expanded by 8.7% in 2025, creating significant wealth that is invested in the local fund market2.
ETFs are the mainstay for Taiwanese investors, accounting for around two thirds of total fund industry assets, due to the ongoing popularity of both fixed income and equity products3. And over the last year, the range of funds coming to market has become more diverse, with active ETFs, multi-asset ETFs, and cross-border ETFs now all part of the product mix.
The rapid development of Taiwan’s ETF market – both in terms of size and sophistication – makes it an increasingly attractive destination for international issuers.
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The positive market sentiment in Taiwan has proved resilient throughout 2026, with the benchmark TAIEX index hitting an all-time-high in October.
A widening product shelf
The rise of active ETFs in Taiwan demonstrates how quickly a new product can take in the market. These funds were only approved at the end of 2024, and by May 2025 there were only three products managing NTD8.6 billion (USD266 million). But just one year later, there was a hundredfold increase in AUM to NTD866.4 billion (USD26.7 billion), spread across 25 products4.
In that 12-month period, the range of active ETFs broadened significantly: from products that focused on the equity market as a whole to more specialist funds that invest overseas, focus on the technology sector, or engage in high-dividend strategies. In short, the diversity of active ETFs already provides Taiwanese investors with a wide range of asset allocation options.
There are other products that are new to the market. The first multi-asset ETF was launched in August 2025, though with only three of these passive funds launched as of March, the uptake has been relatively muted compared to the active products5.
The latest product category to be launched are the active covered call ETFs, three of which listed in April6. These funds take a long cash position on equities, while at the same time selling call options. Due to the premium generated by the options, covered call ETFs can be used as part of an income-generating strategy, which aligns with Taiwan's longstanding interest in yield-generating products – such as high-dividend equity ETFs and bond ETFs.
Developing Taiwan’s ETF industry is a key part of the island’s ambitious plans to attract new domestic and international investors, while presenting opportunities for global asset management companies to issue products locally.
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And there are signs that it is working: as of the end of April, six of the world’s top ten asset managers have established investment trust offices in Taiwan7.
Kaohsiung is the focal point of an official plan to transform the island into an asset management hub for Asia. One year after the city’s financial zone was launched, asset managers have launched 16 offshore funds with an AUM of NTD3.9 billion8.
HSBC – supporting issuers on the ground
Buoyant markets, a supportive policy backdrop, and a local investor preference for ETFs makes Taiwan a compelling market for global issuers. They can bring experience and strategies that have proved successful in other markets. Furthermore, their cross-border products will stand out if they have strong trading and research resources in the target market that a Taiwanese competitor might lack.
International issuers have been very active in 2026, with foreign firms behind nine of the 26 ETFs launched in the first seven months of the year9.
As one of the largest international securities services providers in Taiwan, HSBC plays an important role in supporting issuers to launch and manage ETFs on the island covering fund administration and transfer agency, and global custody (via the Hong Kong hub). We’re supporting issuers in Taiwan with multiple ETF deals and a strong pipeline.
In addition to helping issuers, we are providing input, through industry engagement, on proposed changes aimed at improving ETF market efficiency – such as reviewing opportunities to the shorten dividend distribution timeline, assessing mechanisms to facilitate same day primary creation, and secondary-market selling for overseas equity ETFs. As standards are finalised, HSBC will work with clients to align operational processes, service levels and documentation as required.
Our ETF servicing capabilities in Taiwan have been designed to operate seamlessly with the capabilities provided by our global platforms. The platform not only fulfils all current local requirements, but at the same time provides a strong foundation for further enhancements of the operating model to cater to evolving market needs.
HSBC's Taiwan offering has received industry recognition through a number of market awards. Most recently, we were awarded Taiwan's Best for Securities Services by Euromoney and Best Fund Administrator by The Asset for the ninth consecutive year.
As Taiwan's ETF market continues to mature, HSBC is well placed to support the next stage of that growth. We look forward to working closely with both established and new-to-market issuers as they navigate Taiwan's fund landscape and bring new strategies to local investors, backed by the depth of our global securities services platform and our on-the-ground expertise in Taiwan.
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