China’s stock market has been volatile, but the gateways to the Chinese markets, via exchange traded funds (ETFs), have somehow held up. All 3 of the Chinese-focused ETFs owe their latest success to the large Chinese oil companies; Trang Ho of Investor’s Business Daily reports these ETFs are all heavily weighted in the oil companies. It hasn’t hurt that the Chinese government is planning to discuss how to stabilize its volatile stock market. And with rising inflation, money is moving from Chinese bonds into equities.
iShares FTSE/Xinhua China 25 Index (FXI) is up 2.4% for the past month, and 1.4% for the year. PowerShares Golden Dragon Halter USX China Portfolio (USX) is up 5% for the month and 11% for the year. The newest Chinese focused ETF, the SPDR S&P China (GXC), is up 3.4% over the last month.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.