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ETF Talk: These Chinese Red Chips are Really Blue

China’s astonishing growth in Gross Domestic Product (GDP) during the past several years has been driven in no small part by infrastructure investment, economic liberalization and rising living standards. As China has de-regulated its banking and investment sectors, opportunities continue to abound for Chinese and foreign investors alike. One way to dip your toe into this market is via the iShares China Large-Cap ETF (FXI).

This fund attempts to match the price and yield performance, before fees and expenses, of an investment fund focused on the largest and most liquid 25 Chinese companies traded on the Hong Kong Stock Exchange. These companies operate in mainland China and include red chips (Chinese companies incorporated outside China), p chips (Chinese companies incorporated in the Cayman Islands, Bermuda and the British Virgin Islands) and H Shares (companies incorporated inside mainland China).

FXI is down 5.63% for the year, following a drop in July. This dip presents an opportunity for investors to make a market-recovery play. After a similar slip in July 2012, the fund finished the year up by 16%. FXI’s dividend yield is 2.49%.

To read the rest of this article, please click here now.

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ETF Talk: These Chinese Red Chips are Really Blue

China‚??s astonishing growth in Gross Domestic Product (GDP) during the past several years has been driven in no small part by infrastructure investment, economic liberalization and rising living standards. As China has de-regulated its banking and investment sectors, opportunities continue to abound for Chinese and foreign investors alike. One way to dip your toe into this market is via …

China‚??s astonishing growth in Gross Domestic Product (GDP) during the past several years has been driven in no small part by infrastructure investment, economic liberalization and rising living standards. As China has de-regulated its banking and investment sectors, opportunities continue to abound for Chinese and foreign investors alike. One way to dip your toe into this market is via the iShares China Large-Cap ETF (FXI).

This fund attempts to match the price and yield performance, before fees and expenses, of an investment fund focused on the largest and most liquid 25 Chinese companies traded on the Hong Kong Stock Exchange. These companies operate in mainland China and include red chips (Chinese companies incorporated outside China), p chips (Chinese companies incorporated in the Cayman Islands, Bermuda and the British Virgin Islands) and H Shares (companies incorporated inside mainland China).

FXI is down 5.63% for the year, following a drop in July. This dip presents an opportunity for investors to make a market-recovery play. After a similar slip in July 2012, the fund finished the year up by 16%. FXI‚??s dividend yield is 2.49%.

To read the rest of this article, please click here now.

Written By

Doug Fabian is the editor of Successful Investing and High Monthly Income, and is the host of the syndicated radio show, "Doug Fabian's Wealth Strategies." Taking over the reigns from his dad, Dick Fabian, back in 1992, Doug has continued to uphold the reputation of the newsletter as the #1 risk-adjusted market timer as ranked by Hulbert‚??s Investment Digest. For more than 30 years, Successful Investing (formerly the Telephone Switch Newsletter) has produced double-digit annual gains. Doug has become known for his expert knowledge and timely use of innovative tools like Exchange Traded Funds, bear funds and Enhanced Index funds to profit in any market climate.

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