Should You Be Investing in China Bonds?

China's bond market is the third largest in the world. Should fixed income investors weight their portfolio's accordingly?

Don Phillips 22 January, 2018 | 1:07PM

Shanghai, China

At $10.5 trillion, China’s bond market was the world's third largest, behind the US and Japan. Given the size and growth trajectory of China’s onshore bond market, we believe there is scope for foreign investors to participate more heavily in it and for the asset class to potentially play a bigger role in global bond portfolios.

Foreign investors have historically participated in China’s bond market via the smaller offshore segment of the market, which has a higher penetration level than the onshore market, where foreign ownership remains low because of limited accessibility in past years.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

About Author

Don Phillips  is a managing director at Morningstar and Morningstar’s president of fund research.

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