Media coverage of China’s economic struggles may be overshadowing some bright spots worth discussing. While, the real estate situation in China has dampened its economy, recent positive news about Meituan (MPNGY) pushes back on that narrative. As such, it may be worth considering how to access MPNGY via a China ETF like the KraneShares CSI China Internet ETF (KWEB).
See more: Emerging Markets: Honing a China Allocation
Perhaps most intriguing is how the firm’s strong fourth quarter relied on a rebound in consumption; specifically, suggesting enduring strength among Chinese consumers. The shopping and delivery platform put up a 2.22 billion yuan profit, exceeding recent analyst projections of CNY 958 million in profit as reported by the Wall Street Journal.
That in part speaks to the enduring idea that Chinese consumers may be “Zero COVID” era savings. Whether that spending is emerging now or not, the Meituan news speaks to the persistent case for a China allocation. Even as the country’s economy fails to meet its lofty goals, U.S.-based investors can still find returns and diversification via a China ETF.
A China ETF for Meituan News
That’s where KWEB comes in. The ETF launched more than 10 years ago. Charging 69 basis points, the strategy tracks the CSI Overseas China Internet index. In doing so, it offers investors “pure play” exposure to Chinese software and tech stocks.
KWEB weights MPNGY as its fourth-largest holding as of this writing, listed as Class B Meituan shares. The ETF has returned 6.5% over the last month thanks to its index approach. That has helped it outperform both its ETF Database Category and FactSet Segment averages.
The positive Meituan news adds to a ongoing conversation about resilience in China’s economy. The country’s economic narrative is not a monolith, with KWEB offering exposure to some intriguing opportunities like those in MPNGY.
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