Retail Traders Dive Into Chinese ETFs Even as Institutional Investors Flee

Retail investors have been flocking to ETFs that track Chinese companies, after a stringent regulatory crackdown by Beijing has forced some stocks to retreat to sharp lows.

According to the Financial Times, which cited data from investment research firm CFRA, the KraneShares CSI China Internet ETF (NYSE: KWEB), which tracks major Chinese companies such as Alibaba, Tencent, JD.com and Meituan, has seen new inflows soar by $2 billion since the beginning of July. Similarly, the KraneShares CSI China Internet ETF, which is valued at around $5.3 billion, has seen its daily inflows from retail investors surge to record-highs, during a time when traditional institutional investors are backing away due to increased vulnerability.

The latest surge in inflows from retail investors comes at a time when Chinese companies trading on international exchanges such as the NYSE and Nadaq face increased regulatory pressure from Beijing. “Investors tend to expect elevated risk associated with emerging markets and while Chinese stocks have been hit hard, there is view that this is a buying opportunity for some funds that are trading at cheap valuations,” explained CFRA head of mutual fund and ETF strategy Todd Rosenbluth.

However, according to JPMorgan analysts, there will likely be additional regulatory interventions en route from Beijing, particularly when it comes comes to antitrust, unfair competition, data regulations, teenager protection as well as cyber security. This will likely prompt an even further retreat by major institutions, and create additional challenges for retail investors.


Information for this briefing was found via the Financial Times and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Why $50 Silver, $4000 Gold Might Be Closer Than Anyone Thinks | Bradley Langille – GoGold Resources

Why Silver’s True Price Could Be Much Higher | Joaquín Marias – Argenta Silver

Gold Enters A ‘Stronger For Longer’ Phase | Richard Young – i-80 Gold

Recommended

Emerita Resources Intersects Further Mineralization At El Cura, Expanding Deposit

ESGold Sees ANT Survey Reveal Vertically Continuous System To 1,200 Metres Depth

Related News

China Reacts to West’s Sanctions on Russia

The Chinese government is opposing sanctions introduced by the West and the EU against Russia,...

Monday, February 28, 2022, 02:52:00 PM

George Soros: Investors Piling Into Chinese Stocks Face ‘Rude Awakening’

Liberal philanthropist George Soros has issued his take on the recent interest in Chinese stocks,...

Thursday, September 2, 2021, 02:38:00 PM

‘The Big Short’ Michael Burry: Tesla’s Bitcoin Purchase Was A Distraction From Quality Control Complaints

Michael Burry, the infamous hedge fund manager who successfully predicted the US housing market collapse...

Wednesday, February 10, 2021, 05:39:00 PM

Tesla’s China Exports Jump in August as Chinese EV Sales Soar 275%

Tesla’s (NASDAQ: TSLA) exports of Chinese-made vehicles ramped up last month, as the automaker expanded...

Friday, September 10, 2021, 10:07:00 AM

Is China Quietly Amassing Gold?

China has been purchasing gold at a rate ten times higher than officially disclosed, buying...

Saturday, December 21, 2024, 09:17:00 AM