'KMED' Could Gain from Approval of Chinese Vaccine

That could be good news for the KraneShares Emerging Market Healthcare Index ETF (KMED), which holds several Chinese pharmaceutical stocks.

Although Sinovac isn’t one of KMED’s holdings, the positive vaccine news could ripple throughout the healthcare sector, in a rising tide that lifts all boats.

The Sinovac vaccine will be approved for all adults ages 18 and older, after a safety, efficacy, and manufacturing review by the WHO technical board.

The efficacy rate given by the WHO for the vaccine is 51% for preventing symptomatic disease, and 100% for preventing severe COVID-19 and hospitalization.

This particular vaccine will be branded CoronaVac and is the eighth Covid-19 vaccine to be approved by the WHO. It joins the only other Chinese vaccine to have been approved, one that was produced by Sinopharm, a state-backed pharmaceutical company.

A third Chinese vaccine produced by CanSino Biologics has provided the WHO with clinical trial data but is not yet scheduled for review.

The KraneShares Emerging Market Healthcare Index ETF (KMED) provides exposure to small-, mid- and large-cap companies across the emerging markets that are involved with pharmaceutical manufacturing, biotechnology, hospital and healthcare management, and other sub-industries.

The healthcare industry in emerging markets tends to exhibit low correlation to the U.S. healthcare industry, notes KraneShares.

KMED has a 97.83% allocation to the healthcare sector and a 1.59% allocation to consumer staples.

The fund holds more than 150 stocks. Currently, its top holdings include Celltrion Inc, at 4.42%; Samsung Biologics, at 4.14%; and Shenzhen Mindray, at 4.01%.

Over the past 12 months, KMED is up 40.16%.

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