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KraneShares CSI China Internet ETF (KWEB) is an exchange-traded fund that seeks to track the performance of and index that consists of Chinese companies whose primary business activities are related to the internet and digital economy. The ETF is managed by KraneShares and trades under the ticker KWEB on NYSE Arca.
Classified as an equity ETF with geographic exposure to China and a thematic focus, KWEB aims to reflect, before fees and expenses, the performance of the securities comprising its benchmark index.
The fund follows a passive management strategy, maintaining a portfolio structured to replicate the CSI Overseas China Internet Index, that includes Chinese companies listed in mainland China, Hong Kong, or international — markets whose core activities are tied to internet-based business models and digital services.
Constituents are weighted based on market capitalization and liquidity criteria. The index undergoes periodic reviews, including additions, removals, and rebalancing, which are reflected in the ETF’s holdings.
Diversification and sector exposure
KWEB provides concentrated exposure to China’s internet and technology segment, covering various areas of the digital economy, including:
- E-commerce.
- Internet services.
- Digital platforms.
- Applied information technology.
- Online media and communication.
The portfolio structure reflects the composition of China’s digital ecosystem.
Structure and costs
KWEB shares trade on the secondary market throughout the trading session. Creation and redemption occur through authorized participants, helping maintain alignment between market price and net asset value.
The fund charges a management fee and does not apply a performance fee. KWEB may distribute income generated by its underlying holdings in accordance with its operational policies.
History and evolution of the ETF
The KraneShares CSI China Internet ETF was launched in 2013 during a period of rapid expansion in China’s digital and e-commerce sectors.
In recent years, KWEB has reflected significant shifts in China’s technology landscape, including regulatory tightening beginning in 2021, the impact and subsequent reversal of the zero-Covid policy, geopolitical tensions, and broader macroeconomic adjustments.
The fund’s performance has been closely linked to volatility in major Chinese internet companies listed in Hong Kong and the United States.
