Strategists see light at the end of the tunnel for the Hong Kong protests, which has been a months-long saga and have been keeping the capital markets on edge with the latest volatility. Their halt could certainly boost China-focused exchange-traded funds (ETF) as well as the global economy in general given their potential worldwide ramifications.
“I don’t accept this will be a small scale problem in a larger China economy. The reason I don’t is because I believe any intervention (from Beijing) to Hong Kong will be immediately, umbilically, linked to what happens to trade talks and international relations globally,” said strategist David Roche, who is president at research and investment consulting firm Independent Strategy.
If President Xi would meet directly and personally with the protesters, there would be a happy and enlightened ending to the Hong Kong problem. I have no doubt! https://t.co/eFxMjgsG1K
— Donald J. Trump (@realDonaldTrump) August 15, 2019
With over 2,000 ETFs available on the market, which ones are poised to shine for the rest of 2019 and beyond that? One area to look is China-focused ETFs that may have added more value to investors given the recent trade war turmoil and could get a boost if the issue of Hong Kong protests is resolved.
Trade deal or no trade deal, China is a major player in the world economy and will be for the foreseeable future. While it plays second fiddle to the United States in terms of sheer gross domestic product (GDP), it’s importance for global growth can’t be ignored.
One ETF to consider is the Xtrackers Harvest CSI 300 China A ETF (NYSEArca: ASHR) as a way for investors to gain exposure to China’s biggest, best and most authentic equities. ASHR seeks investment results that track the CSI 300 Index that is designed to reflect the price fluctuation and performance of the China A-Share market. In essence, it’s composed of the 300 largest and most liquid stocks in the China A-Share market, including small-cap, mid-cap, and large-cap stocks.
China is beginning to deregulate access to its markets in order to pave the way for more foreign investments to a variety of asset classes. That being said, the capital flowing into China will turn from a trickle into a full-fledge gush if it hasn’t already.
A way for investors to gain exposure to China’s biggest, best and most authentic equities is via the country’s A-shares. ASHR seeks investment results that track the CSI 300 Index that is designed to reflect the price fluctuation and performance of the China A-Share market.
In essence, ASHR is composed of the 300 largest and most liquid stocks in the China A-Share market, including small-cap, mid-cap, and large-cap stocks. Without a majority of its holdings in state-owned enterprises compared to other ETFs, ASHR provides a more diversified representation of gaining access to the world’s second largest economy.
For more market trends, visit ETF Trends.
