H-share ETF refers to a trading open index fund established by foreign shares registered in the Mainland and listed in Hong Kong.

1. H shares, also known as state-owned shares, refer to foreign-funded shares registered in the Mainland and listed in Hong Kong. (Because of the initials of Hong Kong English-Hong Kong, it is called H shares. H shares are physical stocks, and the "T+" delivery system is implemented, with no price limit. Institutional investors in China can invest in H shares, while individuals in mainland China can't directly invest in H shares at present. In Tianjin, individual investors can set up a "through train service for Hong Kong stocks" at the branches of Bank of China and directly invest in H shares. However, the State Council has not yet opened the floodgates for this business. It will take time for individuals to invest directly in H shares. International capital investors can invest in H shares.

2. Transactional open-end index funds, also commonly known as Exchange Traded Funds (ETF), are an open-end fund with variable fund shares listed on the exchange.

Transactional open index fund is a special type of open-end fund, which combines the operating characteristics of closed-end fund and open-end fund. Investors can purchase or redeem fund shares from fund management companies, and at the same time, they can buy and sell ETF shares in the secondary market at the market price like closed-end funds. However, the purchase and redemption must be exchanged for fund shares in a basket or for fund shares in a basket. Because of the existence of securities market trading and subscription and redemption mechanism at the same time, investors can carry out arbitrage trading when there is a price difference between ETF market price and fund unit net value. The existence of arbitrage mechanism makes ETF avoid the common discount problem of closed-end funds.