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Foreign investors are getting a taste of buying Chinese assets. Data from ETF tracking website ETF.com shows that three of the top 10 ETFs with the largest inflows in the U.S. stock market last week (September 30-October 4) were Chinese funds; And in the list of the top 10 ETFs in a week, Chinese ETFs occupy the vast majority of seats.
Recently, Ben Harburg, investment manager ·of CVA Greater China Growth ETF Fund (CGRO), said in an interview with the media: "We seize every opportunity...... A large number of purchases were made in the early days of the A-share rally. ”
Overseas Chinese ETFs were among the top inflows in the week
In the past week, international investors have used ETFs to invest in Chinese assets, and US-listed Chinese equity ETFs have seen significant inflows, with the price performance of these ETFs particularly eye-catching.
According to data from ETF.com website, three of the top 10 ETFs saw the largest inflows last week, three were Chinese funds, and one was a broad emerging market ETF, with Chinese equities being heavily weighted.
Specifically, China's large-cap ETF-iShares (FXI) had a net inflow of more than $2.6 billion last week, ranking third in the net inflow of ETF funds in the whole market. The fourth place is KraneShares China Overseas Internet ETF (KWEB), with a net inflow of more than $1.3 billion; The 3x long FTSE China ETF Direxion (YINN) saw an inflow of $819 million, while the core MSCl emerging markets ETF iShares (IEMG) received a net inflow of $662 million.
ETF Weekly Net Inflows (Top 9 Shown)
Source: ETF.com
In the list of the top 10 ETFs in a week, the vast majority of them are occupied by Chinese ETFs, including China SME Board ChiNext ETF-VanEck, CSI 500 ETF-Deutsche Bank Harvest, CSI 300 China A-share ETF-Deutsche Bank Harvest, China Large Cap ETF-iShares, etc., and CVA Greater China Growth ETF Fund (CGRO) is also on the list.
Top 10 ETFs in a week's performance
Source: ETF.com
Foreign investors are optimistic about the medium- and long-term performance of Chinese assets
In addition to trading overseas-listed Chinese assets, foreign funds are also buying A-shares directly.
Ben · Harberg, managing partner of MSA Capital and investment manager of the CVA Greater China Growth ETF Fund, said in an interview with the media on October 4 that the fund had been heavily invested in Chinese concept stocks before, but it made a large number of purchases in the early stage of the A-share rally, and then switched back to Chinese concept stocks such as Pinduoduo and Tencent. In his view, these fundamentally sound companies will attract a lot of foreign capital as Western investors refocus on the Chinese market.
"The positive momentum is likely to build gradually in the coming quarters." Ben · Haberger said, "There is huge potential demand in the Chinese market. If people feel that they can make money, then [the Chinese market] will rebound strongly. ”
Wind data shows that as of the second quarter of this year, the main positions of the CVA Greater China Growth ETF Fund (CGRO) are concentrated in Chinese concept stocks and Hong Kong stocks listed on the US stocks, such as BYD shares and Tencent Holdings in Hong Kong stocks, Ctrip, Pinduoduo, Tencent Music, Miniso, and Alibaba in US stocks; A-shares are mainly held by CATL, Proya, and Midea Group.
CGRO holdings at the end of the second quarter
Source: Wind
It is worth mentioning that the weekly data released by EFPR, a global fund flow monitor, shows that in the week ending October 2, the emerging market equity funds tracked by EFPR recorded the second-largest weekly inflows this year, and almost all of these inflows went to the Chinese market. Specifically, the net inflow of overseas funds into Chinese equity funds exceeded $13 billion in the single week ended October 2, setting a record for the highest weekly inflow ever. At the same time, the net inflow into the India market on October 2 was about $107 million, less than 1% of the total weekly inflow into the Chinese market.