Chinese ETF Investment Guide

Another great way to gain exposure to China is by investing in an ETF. The advantage of this type of investment is that it gives one a diversified set of holdings without the need to either research each holding or the need to buy each stock.

An ETF, like a mutual fund, owns a collection of stocks that meet the investment criteria of the fund.

When investors buy shares of the ETF, the fund manager creates additional shares by buying or selling more shares of the respective stocks.

The end result is that after a small fee to the manager, the investor receives the performance of the stocks held by the ETF.

Top 3 Largest China-Based ETFs to Buy

The three largest example of China-based ETFs are the iShares FTSE China 25 ETF (FXI – Trade), the SPDR S&P China ETF (GXCTrade) and the Market Vectors China ETF (PEKTrade).

Each of these examples has advantages and drawbacks relative to the others. Anyone interesting in investing is advised to conduct his or her own research before allocating capital.

Further Reading on Chinese ETFs: