China ETFs rallied more than 3% on Wednesday on hopes this battered market can finally get turned around and lead the global economy. The new Chinese leader, Xi Jinping, is trying to instill confidence in the world’s second-largest economy.

Chinese equities on Wednesday rose the most in three months, Bloomberg News reported.

“China shares soared Wednesday after hovering near four-year lows, because of hopes for more economic stimulus policies, including added construction of subsidized housing and other public works, following a meeting of the country’s new top leaders,” reported. “However, market analysts said it was unclear if the day’s gains marked a turning point for the Chinese stock market, which has been one of the world’s worst performing markets despite robust economic growth. The investing public has largely abandoned the market, which is on track for its third consecutive year of declines.”

Recent economic reform in China has helped to get the economy back on track for a new phase of growth. Exchange traded funds offer diversified exposure to Chinese equities with one trade and low costs.

“Valuations are attractive and fears of a major slowdown in China seem to be waning, while China still promises growth faster than the rest of the world,” Paul Gillis, professor at Peking University’s Guanghua School of Management, said in a report.

Billions of dollars have flowed back into China’s equity market and focused funds over the past two months, reports Vikram Subhedar for Reuters. Analysts remain clear that risk factors within the economy are evident, but the attitudes of foreign investors show confidence in the emerging economy. A recent Bank of America Merrill Lynch study found that sentiment regarding China’s economy is at a three-year high.

Fundamentals within China’s economy such as slow earnings, growing corporate debt and loss of interest by local retail investors are problems that have not weighed upon the rapid growth and expansion. Plus, other problems such as fraud, variable interest entities and regulatory disagreements with the U.S. are not going to be solved anytime soon.

“Five years back in 2007 the (Chinese) market was one of the most expensive and now it’s cheap on a par with Korea — it’s one of the cheapest markets in Asia,” Pacific Basin’s Rae said. “There is lots of stuff that’s cheap — some has recovery potential but then some is cheap for a reason.” [China ETF Trading Picks Up on Rally – Leadership Transition]

Recent economic data still create a solid case for investing in China. The Chinese Purchasing Managers Index just moved above 50 for the first time since October 2011. Readings above 50 on this closely-followed index indicate economic expansion and below 50 are reflective of contraction, reports Dave Goodboy for Street Authority. In addition, year-over-year industrial company profits surged more than 20% in October. This is a huge increase when compared to September’s 7.8% gain. [The Case for China ETFs]