Are ex-China funds overlooking opportunities?

Emerging market fund assets that omit China have surged over the past decade, reflecting investor sentiment and structural shifts. This is due to the country’s economic and regulatory issues, although it is likely that it will be a stand-alone allocation in the future, following in Japan’s footsteps. Therefore, ex-China funds may remain popular and prominent. Investors must consider the risks when opting for funds excluding China. Allocations are shifted towards other emerging markets such as Brazil, India and Taiwan, and limits access to the equity and growth potential of China; the opportunity...