Market Overview

A Slew Of China Sector ETFs Debut

A Slew Of China Sector ETFs Debut

Typical iterations of China sector exchange traded funds predominantly focused on Internet and technology stocks, but Global X has long offered sector ETFs targeting China's energy, financial services and industrial groups, among others.

The New York-based ETF issuer added to its China sector lineup in a big way Tuesday with the debuts of six funds.

What Happened

Global X now offers 11 China sector ETFs, each of which tracks an index from MSCI. Among the new ETFs are the the Global X MSCI Consumer Staples ETF (NYSE:CHIS) and the Global X MSCI China Health Care ETF (NYSE:CHIH).

CHIH enters a growing arena of China-specific health care ETFs and is the third such fund to come to market this year. The new ETF tracks the MSCI China Health Care 10/50 Index. Home to 35 stocks, CHIH allocates nearly three-quarters of its weight to pharmaceuticals companies and health care providers.

CHIS, the new China consumer staples ETF, follows the MSCI China Consumer Staples 10/50 Index and holds 24 stocks. China's consumer staples is not as expansive as the same sector in the U.S. as highlighted by just four industry groups being represented in the new CHIS.

Why It's Important

Global X, which already had a fund representing China technology and Internet stocks, also unveiled the Global X MSCI China Information Technology ETF (NYSE:CHIK), which tracks the MSCI China Information Technology 10/50 Index. That new ETF holds 34 stocks, over half of which are makers of electrical components or semiconductors.

The Global X MSCI China Communication Services ETF (NYSE: CHIC) is the first China-specific fund for that sector. Communication services officially debuted in the U.S. in September with the first domestic ETF dedicated to the sector launching last June. Software and hardware companies combine for about 85 percent of that new ETF's roster.

What's Next

Global X's new China sector ETFs span groups that, in the U.S., are usually viewed as conservative. The Global X MSCI China Real Estate ETF (NYSE:CHIR) and the Global X MSCI China Utilities ETF (NYSE:CHIU) round out Global X's new offerings.

Each of the new ETFs carries annual fees of 0.65 percent, or $65 on a $10,000 investment.

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