Topic: How To Invest

ISHARES FTSE/XINHUA CHINA 25 INDEX FUND $40.21 – New York symbol FXI

ISHARES FTSE/XINHUA CHINA 25 INDEX FUND $40.21 (New York symbol FXI; buy or sell through brokers) is an exchange traded fund that aims to track the FTSE/Xinhua China 25 Index, which is made up of the 25 largest, most liquid Chinese stocks. All of the stocks in the index trade on the Hong Kong exchange. Some also trade as American Depositary Receipts (ADRs) on New York.

The fund’s top holdings are Tencent Holdings, 10.2%; China Construction Bank, 8.4%; China Mobile, 8.3%; Industrial & Commercial Bank, 6.9%; Bank of China, 5.4%; China Overseas Land & Investment, 4.3%; China Life, 4.0%; Ping An Insurance, 4.0%; China Shenhua Energy, 3.9%; PetroChina, 4.2%; China Merchants Bank, 3.7%; and CNOOC Ltd., 3.7%.

The fund’s holdings give it the following industry breakdown: Financials, 54.1%; Telecommunications, 14.4%; Oil and Gas, 12.1%; Technology, 10.1%; Basic Materials, 4.0%; Industrials, 1.8%; and Consumer Goods, 1.7%. Its expense ratio is 0.73%.

Chinese stocks are up 24% from March 2014. That’s mainly because the country’s government has committed to growth by continuing to inject money into the economy. As well, China’s economy, and especially exports, should grow as the U.S. and European economies continue to improve.

iShares FTSE/Xinhua China 25 Index Fund is a buy for safety-conscious investors who are willing to accept some risk.

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