China just unlocked a new level for its ETF market. The China Securities Regulatory Commission has greenlit actively managed exchange-traded funds, a product category that has reshaped investing in the US and Europe but was previously off-limits in mainland China.
Until now, Chinese ETF providers were restricted to enhanced index ETFs, which allow a maximum deviation of only 20% from their benchmark indices.
From enhanced index to full active: what actually changes
Actively managed ETFs break that leash entirely. Portfolio managers can construct holdings based on their own research, convictions, and market views without being anchored to any specific index. In the US, actively managed ETFs have exploded in popularity, with firms like JPMorgan and Dimensional Fund Advisors building massive franchises around the format.
JPMorgan Asset Management had been publicly anticipating this moment. CEO George Gatch projected earlier in 2026 that the CSRC would grant permission for actively managed ETFs within the year. State Street similarly flagged in its 2026 ETF outlook that policy support for full actively managed ETFs, the kind not reliant on benchmarks, was on the horizon.
