Jump to content

Best Chinese ETFs

Recommended Posts

Posted (edited)

It came up at the Berkshire AGM yesterday that the number of Chinese companies in the top 20 list will probably be higher than 3 thirty years from now.  Their valuation will likely be also order(s) of magnitude higher than today's valuations.  However, there is good probability that the actual Chinese companies will be different from the ones that are in the top 20 list today.  

Even though Chinese economy will be much larger than the U.S. economy by then, Buffett thought U.S. companies will still outnumber Chinese companies in the top 20 list then, presumably because of the legal framework and the overall system we have in place in the U.S. 

To still have some benefit from Chinese growth, wondering if folks have looked into Chinese ETFs from the perspective of expense ratio, composition, securities lending practices, whether they are at risk of ADRs being delisted, whether they have exposure to VIE structure issues, etc. 

Regarding composition, S&P 500 might work fine for U.S., but I'm wondering if top 50-100 would be better for China because of higher chance of fraudulent accounting with smaller companies.  On the other hand, even though the top few companies will probably have the biggest extraction power from the economic value flowing through them, but unlike U.S., Chinese regulators will probably keep them in check most as well to make sure their extraction power is limited. 

What do folks think would be the best ETF to take a cut of Chinese economic transactions, and grow along with the Chinese economy? 

Edited by LearningMachine
Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

  • Create New...