Hong Kong may be the next Asian frontier for related exchange traded funds (ETFs). The stock market is taking off: It hit new highs Thursday and rose 11% in the past month for a 58% gain. Financial Times reports that the currency, contrasted with the U.S. dollar, is pushing its upper limit. The benchmark Hang Seng is trading at 22 times next year’s earnings. Chinese companies make up more than half of the market capitalization and resources is one of its fattest sectors.

iShares MSCI Hong Kong (EWH) may be a gateway for ETF investors to tap into this booming market. Carl Delfeld for ETFXRAY believes that Hong Kong is right behind the United States in terms of market. Hong Kong is volatile and heavily tied to real estate. The stock market is a different animal these days in comparison to the tech bust.  Hong Kong markets closed sharply lower on Friday dragged down by property stocks and on profit taking.


For full disclosure, Tom Lydon’s clients own shares of EWH.

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