ETF Trends CEO Tom Lydon appeared on Varney & Co on Fox Business Network on Monday to discuss buying China ETFs on the dip amid trade tensions.
As of 2 pm ET Monday, the iShares China Large-Cap ETF (FXI) was down 3.06% while the Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR) was down 5.39%.
Trump stated the U.S. could increase tariffs on $200 billion in Chinese imports to 25%, up from the current 10%, as the U.S. and China begin a new round of talks this week in Washington, the Wall Street Journal reports.
Lydon said China ETFs are a great buying opportunity as China stocks are up over 30% this year.
“What Trump did this weekend was give investors an opportunity – it opened up the door,” Lydon said. “Chinese stocks are down 7% (overnight). If you want to buy the biggest, FXI is the iShares 50 top biggest Chinese stocks. If you want to get right into mainland China, the ticker is ASHR, which is the CSI 300 stocks traded on mainland China, which were down 7% this morning, but they’ve come back a little bit. They are up over 40% so far this year. A lot of people looked at this whole thing and have been saying ‘boy it’s happening too fast, I may have missed it’ – here’s the opportunity to get in.”
Lydon said China ETFs are a buying opportunity for investors who anticipate a trade deal with China will be reached.
“You know Trump has a few things going for him: black belt negotiator for sure, but as you pointed out earlier, they have a lot more to lose,” Lydon said.
FXI seeks to track the investment results of an index composed of large-capitalization Chinese equities that trade on the Hong Kong Stock Exchange. The ETF seeks investment results that correspond generally to the price and yield performance of the FTSE China 50 Index.
ASHR seeks investment results that correspond generally to the performance, before fees and expenses, of the CSI 300 Index.
Click below to watch the segment on Fox Business Network:
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