While we are skeptical that China will return to double-digit growth anytime soon, if ever, current indicators are not signaling a hard landing. While there are significant risks to the Chinese market – an opaque banking system and a real-estate crash being two – I feel that the slowdown in growth is already reflected in the price of Chinese equities. Should the economy decelerate further, I would revisit my view. But for now, I think the bad news is already baked into the price.
iShares FTSE China 25 Index ETF (NYSEArca: FXI)
Russ Koesterich, CFA, is the iShares Global Chief Investment Strategist.