ETFs to Watch After China’s Online Retail Giant Smashes Sales Record

Chinese e-commerce powerhouse Alibaba set a sales record on “Singles Day,” which is a massive 24-hour shopping event. The company took in $30.5 billion during the event—its 11th year in running—a sign that investors may want to give Chinese tech-focused ETFs a look.

It’s a play worth noting as the second largest economy looks to wean itself from dependence on the U.S. The topic of technology has been a hot button topic during the U.S.-China trade war.

The “Singles Day” event last year took in more sales than any single U.S. event, including Black Friday and Cyber Monday. To help inject more sales, Alibaba did implement some changes for this year—per a CNBC report, “Hangzhou-based Alibaba expanded the number of discounted items in this year’s event and put a heavy emphasis on livestreaming via its platforms to help sell goods. Livestreaming has become a big part of the shopping experience on Chinese e-commerce sites.”

The livestreaming certainly helped to add an interactive component to “Singles Day.” It also gave a chance for celebrity entrepreneurs to showcase their brands.

“Online personalities often speak to their followers and talk about products as well,” the report noted. “On Wednesday, Kim Kardashian did a livestream announcing her fragrance brand KKW will be available for sale on Tmall.”

It’s certainly a good sign for China given that the economic data is showing a slowdown in combination with competition from other markets globally. However, there could be a buy-the-dip opportunity for investors who want to capitalize on China’s growing technology sector.

As such, with technology as the focus for Chinese equities, here are three China tech ETFs to consider moving towards the end of 2019:

  1. Invesco China Technology ETF (NYSEArca: CQQQ): CQQQ is based on the AlphaShares China Technology Index, which is designed to measure the performance of the investable universe of publicly-traded information technology companies open to foreign investment that are based in mainland China, Hong Kong or Macau.
  2. Global X MSCI China Information Technology ETF (CHIK): CHIK tries to reflect the performance of the large- and mid-capitalization segments of the MSCI China Index that are classified in the Information Technology Sector as per the Global Industry Classification System.
  3. KraneShares CSI China Internet Fund (NasdaqGM: KWEB): KWEB tracks a portfolio of Chinese internet and internet-related companies. The portfolio includes Chinese internet companies that provide similar services as Google, Facebook, Twitter, eBay and Amazon.

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