Our goal in this profile is to help investors wade through the many competing ETF offerings available. Using our long experience as an ETF publication, and nearly 40 years in the investment business, we can help select those ETFs that matter and may or may not be repetitive. The result is a more manageable list of issues from which to view and make selections.
China remains the world’s fastest growing economy continues to intrigue and draw investors to it. The high rated of economic growth has positive implications for investments opportunities. At the same time high rates of growth create inflationary pressures which can quickly cause turmoil and losses for linked equity markets. There remains a level of regulatory and corporate governance mistrust among some investors questioning the accuracy of accounting standards and enforcement.
There are enough ETF choices from which to choose and we provide you with some of the most popular choices. We’ve cobbled some good choices together and where repetitive choices exist we’ve paired some together having similarities too hard to ignore.
We’re not ranking these ETFs favoring one over another so don’t let the listing order mislead you. Although we may use some of these in ETF Digest portfolios it’s not our intention to recommend one over another.
Our technical analysis methodology involves using, where possible, monthly charts with enough data to allow investors to stay on the right side of the 12 month moving averages. Further, when market prices move too far above or below this moving average investors can assume a correction in the other direction will eventually take place. In this regard caution is advised.
ProShares and Direxion Shares both offer inverse and leveraged long ETFs for those investors wishing to hedge or speculate.
FNI (First Trust Chindia ETF) follows the ISE Chindia ETF which consists of 50 ADRs and or stocks of companies domiciled in China or India. The fund was launched in May 2007. The expense ratio is .60%. AUM (Assets under Management) equal $130 million and average daily trading volume is 48K shares. As of mid-August 2011 the annual dividend was $.05 making the current yield .22% and YTD return -9.50%.
FXI (iShares China 25 Index ETF) follows the FTSE China 25 Index which measures the performance of the largest companies in the China equity market. The fund was launched in October 2004. The expense ratio is .72%. AUM equal nearly $6 million and average daily trading volume is 18M shares. As of mid-August 2011 the annual dividend was $.17 making the current yield .47% and YTD return of -14.80%.
Direxion Shares and ProShares each have inverse and leveraged products available for those wishing to hedge or speculate.
PGJ (PowerShares Golden Dragon ETF) follows the Halter USX China Index which is comprised of U.S.-listed securities of companies that derive a majority of their revenue from China. The fund was launched in December 2004. The expense ratio is .60%. AUM equal $320 million and average daily trading volume is 84K shares. As of mid-August 2011 the annual dividend was $.11 making the current yield .58% and YTD return -11.30%.
Yanzhou Coal Mining Company Limited ADR (YZC): 4.40%
GXC (SPDR S&P China ETF) follows the S&P China BMI Index which is a market capitalization weighted index of companies traded in China available to foreign investors. The fund was launched in March 2007. The expense ratio is .59%. AUM equal $688 million and average daily trading volume is 112K shares. As of mid-August 2011 the annual dividend was $.29 making the current yield .44% and YTRD return -9.15%.
China Shenhua Energy Company Limited (01088): 2.30%
YAO (Guggenheim China All-Cap ETF) follows the AlphaShares China All-Cap Index which includes companies with market capitalizations greater than $500 million. The fund was launched in October 2009. The expense ratio is .70%. AUM equal $72.5 million and average daily trading volume is 27K shares. As of mid-August 2011 the annual dividend was $.28 making the current yield 1.15% and YTD -10.45%.
China Shenhua Energy Company Limited (01088): 2.49%
HAO (Guggenheim China Small Cap ETF) follows the AlphaShares China Small Cap Index which is a proprietary measure of companies is China with a minimum market capitalization of $200 million to a maximum of $1.5 billion. The fund was launched in January 2008. The expense ratio is .70%. AUM equal $220 million and average daily trading volume is 160K shares. As of mid-August 2011 the annual dividend was $.44 making the current yield 1.85% and YTD return -21.20%.
Data as of August 2011
HAO Top Ten Holdings & Weightings
China Shanshui Cement Group Limited (00691): 1.93%
Mindray Medical International Limited ADR (MR): 1.54%
FCHI (iShares China ETF) follows the FTSE China Hong Kong Listed Index which includes mid-cap and large-cap companies listed in Hong Kong. The fund was launched in June of 2008. The expense ratio is .72%. AUM equal $47 million and average daily trading volume is 6K shares. As of mid-August 2011 the annual dividend was $.38 making the current yield .88% and YTD return -15.25%.
China Shenhua Energy Company Limited (01088): 2.82%
China Petroleum & Chemical Corporation (00386): 2.73%
EWH (iShares Hong Kong ETF) follows the MSCI Hong Kong Index which is a proprietary measure of the entire Hong Kong equity market. The fund was launched in March 1996 and is the granddaddy of all China-based funds. The expense ratio is .53%. AUM equal $1.5 billion and average daily trading volume is 5.8M shares. As of mid-August 2011 the annual dividend was $.17 making the current yield 1% and YTD return -10.50%.
Index IQ recently launched a small-cap Hong Kong ETF (HKK) which should bear some watching as it seasons.
MCHI (iShares MSCI China ETF) follows the MSCI China Index which is the proprietary index measuring large-cap China equities. The fund was launched in March 2011. The expense ratio is .61%. AUM equal $25 million and average daily trading volume is 7.5K shares. As of mid-August 2011 the annual dividend yield was unavailable and YTD return was -16.70%.
China Petroleum & Chemical Corporation (00386): 2.42%
CHIQ (Global X China Consumer ETF) follows the Solactive China Consumer Index which includes companies domiciled in China which have a consumer orientation. The fund was launched in November 2009. The expense ratio is .65%. AUM equal $177 million and average daily trading volume is 114K shares. As of mid-August 2011 the annual dividend was $19 making the current yield 1.14% and YTD return -7.05%.
Guangzhou Automobile Group Co., Ltd. (02238): 4.02%
Two other ETFs stand-out as possible inclusions with the first being CHXX (EG Shares China Infrastructure ETF) which is included in another list and follow the INDXX China Infrastructure Index. It includes the 30 leading companies involved in this sector.
Lastly is PEK (Van Eck China ETF) which follows the Shanghai CSI 300 Index. Unfortunately it hasn’t received the exemption from the local authorities to buy shares that can track the popular index and must use a third party with derivatives to do so. This has created a large premium. However, once they’ve obtained this license this will be one of the most important China-based ETFs.
ETF choices from China will continue to rapidly increase. Sometimes these offerings will need seasoning before investors can verify performance trends and validate investing in them. We’ve chosen to feature some that may be repetitive but clearly have something to offer as well. Some other Top 10 lists we’ve published may have similar ETFs within them and can become duplicative but we’ll just have to live with this on occasion.
One thing seems clear when viewing many of these ETFs are similar trend patterns many have presented. This is primarily due to globalization but also is the result of easy monetary conditions throughout the developed world allowing for higher levels of correlation.
For further information about portfolio structures using this or other ETFs see www.etfdigest.com.
You may address any feedback to:
This e-mail address is being protected from spambots. You need JavaScript enabled to view it
(Source for holding data is from ETF Database and from various sponsors.)
Our goal in this profile is to help investors wade through the many competing ETF offerings available. Using our long experience as an ETF publication, and nearly 40 years in the investment business, we can help select those ETFs that matter and may or may not be repetitive. The result is a more manageable list of issues from which to view and make selections.
China remains the world’s fastest growing economy continues to intrigue and draw investors to it. The high rated of economic growth has positive implications for investments opportunities. At the same time high rates of growth create inflationary pressures which can quickly cause turmoil and losses for linked equity markets. There remains a level of regulatory and corporate governance mistrust among some investors questioning the accuracy of accounting standards and enforcement.
There are enough ETF choices from which to choose and we provide you with some of the most popular choices. We’ve cobbled some good choices together and where repetitive choices exist we’ve paired some together having similarities too hard to ignore.
We’re not ranking these ETFs favoring one over another so don’t let the listing order mislead you. Although we may use some of these in ETF Digest portfolios it’s not our intention to recommend one over another.
Our technical analysis methodology involves using, where possible, monthly charts with enough data to allow investors to stay on the right side of the 12 month moving averages. Further, when market prices move too far above or below this moving average investors can assume a correction in the other direction will eventually take place. In this regard caution is advised.
ProShares and Direxion Shares both offer inverse and leveraged long ETFs for those investors wishing to hedge or speculate.
FNI (First Trust Chindia ETF) follows the ISE Chindia ETF which consists of 50 ADRs and or stocks of companies domiciled in China or India. The fund was launched in May 2007. The expense ratio is .60%. AUM (Assets under Management) equal $130 million and average daily trading volume is 48K shares. As of mid-August 2011 the annual dividend was $.05 making the current yield .22% and YTD return -9.50%.
Data as of August 2011
FNI Top Ten Holdings & Weightings
FXI (iShares China 25 Index ETF) follows the FTSE China 25 Index which measures the performance of the largest companies in the China equity market. The fund was launched in October 2004. The expense ratio is .72%. AUM equal nearly $6 million and average daily trading volume is 18M shares. As of mid-August 2011 the annual dividend was $.17 making the current yield .47% and YTD return of -14.80%.
Direxion Shares and ProShares each have inverse and leveraged products available for those wishing to hedge or speculate.
Data as of August 2011
FXI Top Ten Holdings & Weightings
PGJ (PowerShares Golden Dragon ETF) follows the Halter USX China Index which is comprised of U.S.-listed securities of companies that derive a majority of their revenue from China. The fund was launched in December 2004. The expense ratio is .60%. AUM equal $320 million and average daily trading volume is 84K shares. As of mid-August 2011 the annual dividend was $.11 making the current yield .58% and YTD return -11.30%.
Data as of August 2011
PGJ Top Ten Holdings & Weightings
GXC (SPDR S&P China ETF) follows the S&P China BMI Index which is a market capitalization weighted index of companies traded in China available to foreign investors. The fund was launched in March 2007. The expense ratio is .59%. AUM equal $688 million and average daily trading volume is 112K shares. As of mid-August 2011 the annual dividend was $.29 making the current yield .44% and YTRD return -9.15%.
Data as of August 2011
GXC Top Ten Holdings & Weightings
YAO (Guggenheim China All-Cap ETF) follows the AlphaShares China All-Cap Index which includes companies with market capitalizations greater than $500 million. The fund was launched in October 2009. The expense ratio is .70%. AUM equal $72.5 million and average daily trading volume is 27K shares. As of mid-August 2011 the annual dividend was $.28 making the current yield 1.15% and YTD -10.45%.
Data as of August 2011
YAO Top Ten Holdings & Weightings
HAO (Guggenheim China Small Cap ETF) follows the AlphaShares China Small Cap Index which is a proprietary measure of companies is China with a minimum market capitalization of $200 million to a maximum of $1.5 billion. The fund was launched in January 2008. The expense ratio is .70%. AUM equal $220 million and average daily trading volume is 160K shares. As of mid-August 2011 the annual dividend was $.44 making the current yield 1.85% and YTD return -21.20%.
Data as of August 2011
HAO Top Ten Holdings & Weightings
FCHI (iShares China ETF) follows the FTSE China Hong Kong Listed Index which includes mid-cap and large-cap companies listed in Hong Kong. The fund was launched in June of 2008. The expense ratio is .72%. AUM equal $47 million and average daily trading volume is 6K shares. As of mid-August 2011 the annual dividend was $.38 making the current yield .88% and YTD return -15.25%.
Data as of August 2011
FCHI Top Ten Holdings & Weightings
EWH (iShares Hong Kong ETF) follows the MSCI Hong Kong Index which is a proprietary measure of the entire Hong Kong equity market. The fund was launched in March 1996 and is the granddaddy of all China-based funds. The expense ratio is .53%. AUM equal $1.5 billion and average daily trading volume is 5.8M shares. As of mid-August 2011 the annual dividend was $.17 making the current yield 1% and YTD return -10.50%.
Data as of August 2011
EWH Top Ten Holdings & Weightings
Index IQ recently launched a small-cap Hong Kong ETF (HKK) which should bear some watching as it seasons.
MCHI (iShares MSCI China ETF) follows the MSCI China Index which is the proprietary index measuring large-cap China equities. The fund was launched in March 2011. The expense ratio is .61%. AUM equal $25 million and average daily trading volume is 7.5K shares. As of mid-August 2011 the annual dividend yield was unavailable and YTD return was -16.70%.
Data as of August 2011
MCHI Top Ten Holdings & Weightings
CHIQ (Global X China Consumer ETF) follows the Solactive China Consumer Index which includes companies domiciled in China which have a consumer orientation. The fund was launched in November 2009. The expense ratio is .65%. AUM equal $177 million and average daily trading volume is 114K shares. As of mid-August 2011 the annual dividend was $19 making the current yield 1.14% and YTD return -7.05%.
Data as of August 2011
CHIQ Top Ten Holdings & Weightings
Two other ETFs stand-out as possible inclusions with the first being CHXX (EG Shares China Infrastructure ETF) which is included in another list and follow the INDXX China Infrastructure Index. It includes the 30 leading companies involved in this sector.
Lastly is PEK (Van Eck China ETF) which follows the Shanghai CSI 300 Index. Unfortunately it hasn’t received the exemption from the local authorities to buy shares that can track the popular index and must use a third party with derivatives to do so. This has created a large premium. However, once they’ve obtained this license this will be one of the most important China-based ETFs.
ETF choices from China will continue to rapidly increase. Sometimes these offerings will need seasoning before investors can verify performance trends and validate investing in them. We’ve chosen to feature some that may be repetitive but clearly have something to offer as well. Some other Top 10 lists we’ve published may have similar ETFs within them and can become duplicative but we’ll just have to live with this on occasion.
One thing seems clear when viewing many of these ETFs are similar trend patterns many have presented. This is primarily due to globalization but also is the result of easy monetary conditions throughout the developed world allowing for higher levels of correlation.
For further information about portfolio structures using this or other ETFs see www.etfdigest.com.
You may address any feedback to: This e-mail address is being protected from spambots. You need JavaScript enabled to view it
(Source for holding data is from ETF Database and from various sponsors.)