Taipei, 16 October ( InfoTimes)- Standard & Poor (S&P) is set to compile index special for Taiwan for the first time with the first index targeting Chinese- concept shares. Polaris Investment Trust will be assigned to issue derivative financial products based on the index, which comprising of top- 50 shares with profits from Chinese market surpassing over 10% of total company gains. Polaris Investment Trust and S&P will sign formally contract in Hong Kong on Monday on the cooperation. Also, Financial Group chairman Wayne Pai will also sign agreement with Morgan Stanley in the trip to issue financial and technology indices based Exchange Traded Funds (ETF).

To the development, Europe-based institutional investors take positive views, saying S&P's Chinese-concept shares index would be helpful for them to pick out related shares. JP Morgan Chase Taiwan research department chief says international investors hope the shares selected are better covering the Great China region to help them reducing the risk in liquidity.

International investors take increasingly notice of the Great China market, saying funds covering the market already becoming the largest piece in Asian funds except Japan. S&P's willingness in compiling the index signals the importance of Great China market.

Analysts predict the concentration in fund on Chinese-concept shares would emerge due to the introduction of the index. In the short run, they predict Chinese concept shares and domestic shares will lead gains with sightseeing and hotel shares topping other sub-sectors. Foreign investors focus on those financial shares and life insurance shares linking to Chinese market. ( Esther Guan )