Are Chinese equities a minefield or a screaming buy? It’s a debate we’ve had (with slightly more nuance) on various occasions this year, with no easy answer. Now, an equally provocative discussion concerns how those looking to buy the dip get exposure.
Scares about regulatory interference sent shares in China, Asia and emerging market trusts to fairly wide discounts to net asset value (NAV) earlier this year, presenting plenty of entry points for adventurous types. Those discounts have narrowed in recent months, suggesting some have been attempting to grab a bargain using these trusts.
By contrast, many investors are in fact taking a passive route. The KraneShares CSI China Internet UCITS ETF (KWBP) has pulled in around €800m (£679.42m) on a net basis in the first 11 months of 2021. By Morningstar’s reckoning that makes it the second most popular thematic exchange traded fund (ETF) over the period, behind the enormously popular iShares Global Clean Energy UCITS ETF (INRG).