“The four banks averaged an ROE of 20.6%, which was (i) 11.6% higher than that of the developed world banks, (ii) 8.6% higher than the emerging market banks, and (iii) more than twice as profitable as their U.S. bank counterparts,” said WisdomTree Research Director Jeremy Schwartz in an April research note. [WisdomTree: China’s Banks Boost Dividends]
FXI allocates almost 56% of its weight to the financial services sector. MCHI and GXC have financial services weights of 37.1% and 31%, respectively.
Additionally, there is a solid dividend case for China, which is now the largest emerging markets dividend payer in dollar terms.
Research from WisdomTree notes that of the 76 Chinese firms in the WisdomTree Emerging Markets Dividend Index, 54 recently boosted payouts. Research analyst Tripp Zimmerman points out that aggregate dividend growth for those 76 companies “was 10.7%, or an increase from $25.2 billion to $27.9 billion.” [China’s Dividend Growth]
iShares China Large-Cap ETF
Tom Lydon’s clients own shares of EEM.