China ETFs

We would be remiss if we did not address the recent surge in China Equity related ETFs, particularly the recent vault that FXI (iShares FTSE China 25, Expense Ratio 0.72%) has experienced, this morning bumping up against its 200 day moving average for the first time since mid-May (currently trading at $36.22, off of a late June intraday low of $30.61).

FXI remains the largest equity ETF dedicated to exposure to China, with $5.1 billion in assets under management at the moment, and we have also seen upside call buying in the marketplace in recent sessions.

Of the China based ETFs, FXI remains the “place to go” in terms of options liquidity.

A second ETF from iShares MCHI (iShares MSCI China Index, Expense Ratio 0.61%) has been gaining steam since debuting in 2011 as well, gathering $857 million in assets under management and steadily increasing average daily trading volume (520,000 shares).

While not mainland China, EWH (iShares MSCI Hong Kong, Expense Ratio 0.52%) deserves a mention due to its size ($2.2 billion in AUM) and its tendency to trade in sympathy with broader moves in China and Asian equity markets in general.

With the renewed interest in Chinese based equities, other ETFs that may be in focus in the near term include GXC (SPDR S&P China, Expense Ratio 0.59%), PGJ (PowerShares Golden Dragon Halter USX China Portfolio, Expense Ratio 0.60%), and HAO (Guggenheim China Small Cap, Expense Ratio 0.70%) to name just a few, and there are additional China focused ETF strategies offered by other ETF providers as well, including sector specific and mandate specific offerings.