China Funds Still Deliver Long-term Growth

Global markets seem obsessed with ‘weak’ Chinese economic data and the resulting stock market performance - but data shows over the longer term gains can be made

Karen Kwok 20 January, 2016 | 4:39PM
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The Chinese economy is in the middle of a tough shift from manufacturing-driven to being focussed on services; causing volatility in the stock market which threatens investors’ returns. China’s lack of transparency doesn’t help, leading to investor speculation and exacerbating market instability.

Global markets seem obsessed with ‘weak’ economic data and the resulting stock market performance, but Edward Smith, asset allocation strategist at Rathbones, thinks that these fears are misguided.

“The January trade data release shows the volume of Chinese exports increased in December, helped by the currency devaluation since August. Importantly, there were also signs of improving domestic demand: import volumes grew by approximately 7% in 2015. Further evidence that the turmoil of the markets in no way reflects the economic trends,” Smith said.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Allianz China Equity A USD89.07 USD1.16Rating
Fidelity China Focus A-Dis-USD71.93 USD0.38Rating
GAM Star China Equity A USD Acc24.09 USD0.11Rating

About Author

Karen Kwok

Karen Kwok  is a Reporter for Morningstar.co.uk

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