China Bond ETFs Could Strengthen on Improved Bond Connect Program

The increased demand that could come with the new delivery system could help strengthen the Chinese bond markets.

Fixed-income exchange traded fund investors can also gain exposure to the Chinese debt markets through targeted ETF strategies. For example, the Invesco Chinese Yuan Dim Sum Bond Portfolio (NYSEArca: DSUM) is composed of RMB-denominated bonds issued by governments, agencies, supranationals and corporations, excluding synthetics, convertible bonds, retail bonds and CDs.

The KraneShares CCBS China Corporate High Yield Bond USD Index ETF (KCCB) tracks an index that covers high-yield corporate debt from companies located in China.

Additionally, the VanEck Vectors ChinaAMC China Bond ETF (NYSEArca: CBON) follows the ChinaBond China High Quality Bond Index (CDHATRID), which holds government debt, quasi-sovereigns and high-grade corporate bonds.

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