GXC (SPDR S&P China ETF) remains a buy, supported by improving profit expectations and solid year-to-date outperformance versus the S&P 500. The ETF trades at a modest sub-14x P/E, with large-cap, consumer discretionary, and communication services exposures dominating the portfolio. Liquidity is mixed—low average daily volume and wide bid/ask spreads necessitate limit orders, especially near market open.
Both U.S. and Chinese stocks rallied due to a de-escalation in the trade war, boosting the S&P 500 and Hang Seng Indexes. I reiterate a 'Buy' rating on the SPDR S&P China ETF due to its attractive valuation and strong dividend yield. GXC has high exposure to large caps and a balanced mix of value, blend, and growth, despite a concentrated allocation in consumer discretionary and communication services.
GXC: China's Industrial Rebound And Stimulus Will Support Momentum In 2025
| XHAN Exchange | US Country |
The provided company is a financial investment entity focused on the Chinese market. It primarily allocates its resources into securities that form part of a specific index, which is composed of publicly traded companies based in China that are accessible to international investors. This index is constructed based on market capitalization, aiming to provide a comprehensive snapshot of investable Chinese companies. Notably, the fund operates with a non-diversified strategy, meaning it invests a significant portion of its assets in a relatively small number of securities, making it somewhat more exposed to the risks and performances of those securities.
Securities Investment - The fund commits at least 80% of its total assets to securities that are included in the index it tracks. These securities are made up of a collection of publicly traded companies domiciled in China, providing foreign investors with a targeted investment opportunity in the Chinese market. This service aims to mirror the performance of the index, offering investors a chance to participate in the potential growth of China’s publicly traded companies.
Depositary Receipts Investment - In addition to direct securities investment, the fund also invests in depositary receipts that are based on the securities in the index. Depositary receipts represent a certain number of shares of a foreign company's stock and are traded on a local stock exchange. This method provides a more accessible avenue for investors to partake in foreign markets like China, potentially offering a diversified investment option within the fund's focused scope.