China: Emergence of a 3rd Trading Bloc | ETF Trends

Trade issues and COVID-19 uncertainty have made China exposure an awkward recommendation for equity investors. Yet, China may actually be better positioned for post-pandemic growth than the developed markets. The challenge: allocating effectively while navigating the perceived barriers.

In the upcoming webcast, China: Emergence of a 3rd Trading Bloc, Sean Taylor, Chief Investment Officer APAC, Global Head of Emerging Markets Equity: Hong Kong, DWS; Craig Columbus, CEO, Columbus Macro, LLC; and Sean Edkins, Head of ETF Strategic Partnerships, DWS, will discuss the case for exposure, not just to China, but mainland China in particular.

Potential investors who are interested in taking a direct look into China’s market have a number of options available. For example, options at DWS include the Xtrackers MSCI All China Equity ETF (NYSEArca: CN), Xtrackers CSI 300 China A-Shares ETF (NYSEArca: ASHR), Xtrackers CSI 500 China A-Shares Small Cap ETF (NYSEArca: ASHS), and Xtrackers MSCI China A Inclusion Equity ETF (NYSEArca: ASHX).

ASHR is the largest U.S-listed A-shares ETF with $4.2 billion in assets under management and targets the 300 largest and most liquid stocks in the China A-shares market that trade on the China Securities 300 Index.

ASHS tracks more mid-sized Chinese A-shares, including Chinese A-shares taken from the China Securities 500 Index, stocks listed in Shanghai and Shenzhen. The CSI 500 Index is designed to reflect the price fluctuation and performance of small-cap companies in the China A-Share market and is composed of the 500 smallest and most liquid stocks in the China A-Share market.

CN has a broader portfolio, allowing investors to track mainland Chinese stocks, with a 35.1% position in ASHX and 4.7% in ASHS, and the fund holds Chinese stocks listed in the U.S. and Hong Kong.

Lastly, ASHX, which switched its underlying index to the MSCI China A Inclusion Index, tracks the progressive partial inclusion of A shares in the MSCI Emerging Markets Index over time.

Financial advisors who are interested in learning more about China’s market can register for the Thursday, October 29 webcast here.