IN FOCUS6-8 min read

Should investors adapt their approach to investing in Chinese equities?

The increased popularity of standalone China allocations, and the launch of emerging markets ex China strategies, has amplified the debate over how to allocate to Chinese equities. We assess the key considerations.

02/05/2024
China stimulus hero image

Authors

Kirsty McLaren
Investment Director, Emerging Market Equities

The debate around how investors should allocate to China has grown in recent years. Should they continue to include it as part of a global emerging market (EM) equity allocation, or carve the country out from EM and allocate on a standalone basis?

There are pros and cons to both approaches, each of which may carry greater weight depending on an investor’s objectives and constraints. As such, both have validity, but what’s crucial is that the decision on which path to take is made following an informed assessment.

In this paper we cover the drivers of the China allocation debate, discuss the pros and cons, review the key characteristics of Chinese equities, and highlight the main differences between the EM and EM ex China indices.

Read the research paper in full here

Approaches to investing in Chinese equities compared

Authors

Kirsty McLaren
Investment Director, Emerging Market Equities

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