As economies around the world look to bounce back from the Covid-19 pandemic, global investment firm Goldman Sachs is expecting Asia to come back with the most vengeance. This opens up opportunities for Asia-focused exchange-traded funds (ETFs) to benefit from the rebound.
“We think Asia’s really the best positioned of the major regions right now, just given the good control of the virus in most of the region outside of India and some parts of Southeast Asia,” said Andrew Tilton, chief Asia economist at Goldman Sachs, per a CNBC report.
Per the report, Tilton “said China’s consumer spending has been ‘more sluggish’ because, unlike in the U.S., stimulus measures were not directed at income replacement. ‘But I think given the good control of domestic transmission of the virus in China, we are seeing services activity come back there as well,’ he told CNBC’s ’”Street Signs Asia’ on Monday.’"
One place where investors can start in terms of ETF opportunities is the second largest economy—China. After being at the epicenter of the pandemic, the economy is starting to resuscitate itself.
Investors looking to capitalize on growth opportunities in China can look to the VanEck Vectors China Growth Leaders ETF (GLCN). GLCN seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the MarketGrader China All-Cap Growth Leaders Index.
The fund normally invests at least 80% of its total assets in securities that comprise the fund’s benchmark index and/or in investments that have economic characteristics that are substantially identical to the economic characteristics of the securities that comprise its benchmark index. The index is comprised of Chinese equity securities which are generally considered by the index provider to exhibit favorable fundamental characteristics according to its proprietary scoring methodology.
For investors looking for additional plays on China, they can give the VanEck Vectors ChinaAMC SME-ChiNext ETF (CNXT ) a look. CNXT seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the SME-ChiNext 100 Index.
The fund normally invests at least 80% of its total assets in securities that comprise the fund’s benchmark index. The index is a modified, free-float adjusted index intended to track the performance of the 100 largest and most liquid stocks listed and trading on the Small and Medium Enterprise (“SME”) Board and the ChiNext Board of the Shenzhen Stock Exchange. The SME-ChiNext Index is comprised of China A-shares.
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