China Real Estate ETFs May Be Undervalued | ETF Trends

There is no doubt that China is becoming an economic powerhouse. The Asian nation’s exchange traded funds (ETFs) are abundant with opportunities, and one of the most notable ones could be in its real estate sector, which one study found was undervalued.

Comparing price-to-book ratios to return on equity, the Chinese real estate market was the most undervalued when compared to other high-growth nations like India and Hong Kong, comments Kevin Grewal for TheStreet. Some expert analysts estimate that the Chinese real estate sector has underperformed the benchmark MSCI China index by almost 30%. [More China Plays.]

Additionally, recent steps to raise China’s bank reserve requirements could dampen growth and put further downward pressure on property prices.

Still, consumers may start to buy property again, and Credit Suisse is bullish on property developers, construction and contracting. [China’s Infrastructure: Long-Term Growth Story.]

For more information on China, visit our China category.

  • Claymore/AlphaShares China Real Estate (NYSEArca: TAO)


  • Claymore/AlphaShares China All-Cap (NYSEArca: YAO). YAO provides exposure to Chinese lenders China Construction Bank and Bank of China, along with construction and contracting giant China Overseas Land & Investment.


  • iShares FTSE/NAREIT Asia (NYSEArca: IFAS). IFAS allocates more than 8% of its assets to Chinese real estate holdings.

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. 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.