As China continues to grapple with global inflation amid its re-opening, leaders see sectors like manufacturing and technology helping to drive economic growth, according to Chinese president Xi Jinping.
China seeks to wean itself from dependence on other countries and work towards more self-sufficiency. That means advance efficiencies in the manufacturing and tech, Xi noted in a meeting of the Central Financial and Economic Affairs Commission.
Of course, China’s government will have a strong hand in helping to guide this growth. Allocation of funds into the manufacturing and tech sectors will help spur any advancement initiatives. That will allow for growth opportunities for investors.
“The report signals that Beijing’s stimulus effort will be highly focused on the advanced manufacturing sector and non-financial elements of the economy,” the referenced South China Morning Post article said.
A Fund of Fund Opportunity
A number of ETFs offer exposure to China’s ambitious plans for growth. However, for a broad-based opportunity that can encapsulate various sectors, consider the KraneShares China Innovation ETF (KGRO).
This actively managed ETF offers dynamic exposure that allows for portfolio changes when market conditions warrant adjustment. Given this, KGRO is essentially a fund of funds that offers exposure to the following KraneShares ETF products:
- KraneShares CSI China Internet ETF (KWEB): tracks the CSI Overseas China Internet Index, which measures the investable universe of equities of China-based, publicly traded companies that are listed outside of mainland China and primarily involved in the internet and related sectors.
- KraneShares MSCI All China Health Care ETF (KURE): tracks the MSCI China All Shares Health Care 10/40 Index, which measures the performance of Chinese healthcare stocks.
- KraneShares MSCI China Clean Technology ETF (KGRN): tracks the MSCI China IMI Environment 10/40 Index. This benchmark tracks Chinese companies involved in alternative energy, sustainable water, green building, pollution prevention, or energy efficiency.
- KraneShares CICC China 5G & Semiconductor ETF (KFVG): tracks the CICC China Technology Leaders Index. It tracks the 30 largest Chinese companies by free-float market cap in tech sectors, like 5G and semiconductors.
- KraneShares SSE STAR Market 50 Index ETF (KSTR): tracks the SSE Star Market 50 Component Index. This benchmark tracks the 50 largest companies by free float market cap listed on the SSE STAR Market.
If investors want more targeted exposure to these individual funds, they can solely allocate capital to each fund.
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