JPMorgan’s first Taiwan ETF in over decade faces crowded market

Published Thu, Mar 19, 2026 · 02:12 PM

JPMORGAN Asset Management is issuing its first Taiwan-focused wealth management product in more than a decade, joining global rivals rushing into one of Asia’s hottest exchange-traded funds (ETFs) markets.

The US asset manager said on Wednesday (Mar 18) that it will adopt an active investment approach, selecting cash equities and index options for its ETF. Taiwan’s US$260 billion ETF market boasts the highest retail participation in Asia.

“Investors seek high and stable cash distributions but often complain that net asset value doesn’t keep up,” Henry Tong, head of JPMorgan Asset Management Taiwan, said at an event on Wednesday. Tong said that the new fund would generate income through option premiums.

Global asset managers in Taiwan are expanding into ETFs – a space dominated by local firms – as they seek to tap booming retail demand for assets that can offer higher returns than traditional bank deposits and insurance policy-tied instruments. Taiwan is home to Asia’s third-largest ETF market behind Japan and China, according to industry group data.

Buoyed by regulatory easing last year, Allianz Global Investors and Nomura Asset Management, along with major local fund houses, have already launched 11 ETFs investing in Taiwanese equities and targeting benchmark-beating returns through active strategies.

JPMorgan’s fund will be its first one focused on Taiwanese assets since 2010. Cathay Securities Investment Trust, the island’s second-largest asset manager, is also set to begin fundraising next week for its own active Taiwan equity ETF.

Regulators last year began allowing a broader range of fund products as part of efforts boost the asset management sector and position the island as a regional wealth hub.

The new active ETFs, which are managed by professionals seeking to outperform benchmarks, unlike passive funds that track indexes, are expected to attract further inflows. These funds have drawn over NT$240 billion (S$9.6 billion) from Taiwanese investors in less than a year.

Foreign firms in Taiwan are offering ETFs spanning assets from local stocks to overseas high-yield bonds, with some incorporating currency hedging. JPMorgan’s upcoming fund will be the first Taiwan ETF to regularly include covered call options in its portfolio.

“In Taiwan, local ETF issuers dominate the market with over 97 per cent share, giving them a significant competitive edge over their foreign counterparts,” said Bloomberg Intelligence analyst Rebecca Sin. To compete effectively, foreign firms need to differentiate their offerings, such as through an aggressive fee strategy or innovative products, Sin said.

Regulators are also taking other steps to boost the vast-growing sector, including allowing cross-border ETFs listings. Officials gave the go-ahead for ETFs between Taiwan and Japan, which allow ETF listings in one locale to list in the other. BLOOMBERG