Thursday, January 26, 2023
Market-Reporter
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate
No Result
View All Result
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate
No Result
View All Result
Market-Reporter
No Result
View All Result
Home Mutual Funds

What should investors in China and Taiwan funds do now?

MtR by MtR
August 9, 2022
in Mutual Funds
0


After diversifying to the US markets, Indian investors had sometime back taken a fancy to the Greater China region, comprising China, Hong Kong and Taiwan. However, Indian funds focused on this region have found the returns quite underwhelming over the past year.

There are three Indian equity schemes that focus on the Greater China region. Axis Greater China Equity was launched in February 2021; it is down 22% on a yearly basis. Nippon India Taiwan Equity Fund, launched in December 2021, has fared even worse. It is down 30% since its inception. Edelweiss Greater China Equity, launched in 2009, is down 28%. Of the three, Axis Mutual Fund’s scheme is closed for fresh investments because of regulatory limitations on overseas investments.

“There are two reasons behind the fall in returns. Over the last year or so, several regulatory steps were taken by the Chinese government specifically pertaining to new-age businesses. Regulatory regime has been tightened not just in China but across the world as well. The only difference is that the steps taken in China were drastic, and it happened when most of these companies were doing well and the valuations were very high,“ said Niranjan Avasthi, head- product, marketing and digital business, Edelweiss Mutual Fund.

“Further, in the last couple of months, China implemented strict lockdowns in many parts of the country after a rapid increase in covid-19 cases. Because of this, economic activity there suffered, adding to the negative sentiment, especially in the equity markets,” he added.

 

Mint

View Full Image

Mint

On Taiwan specifically, Nippon India Mutual Fund has in a note said that the foreign outflow from Taiwanese equities is intensifying due to several reasons, including an aggressive monetary policy tightening in the US, lockdowns in China impacting regional businesses, and a weaker local dollar.

Related articles

ELSS mutual fund inflows drop over 48% in July: Should you invest?

August 10, 2022

How To Handle Erratic Bond Markets – Fortune India

August 9, 2022

On chances of these funds witnessing more pain, Rushabh Desai, founder of Rupee With Rushabh Investment Services, said, “The answer is ‘yes’. The reason is because we have seen the government policies changing , along with the regulatory issues. The entire property segment is deteriorating and witnessing defaults. Also, the banking system is facing issues. The economy is deteriorating. And, now, we may see a geopolitical crisis, which doesn’t augur well for the markets.”

However, experts are bullish on the long-term prospects of the region.

“Rarely do these kinds of markets trade cheap. China is trading at 11-12 P/E ratio on one-year forward basis. It is the only economy which is probably going through a rate cut cycle rather than rate hike cycle. Given this context, on a relative basis, China is very well placed from a long-term investment perspective”, said Avasthi.

Meanwhile, on Taiwan, Nippon India’s note said that with the recent price correction, the forward 12-month PE ratio of TAIEX has come down to 9.9, way below the 5-year and 10-year average.

The fund house believes that though some uncertainty still exists, it is already reflected in the stock prices and the valuations can potentially bottom out as global inflation is anticipated to trend lower over the next couple of quarters.

Desai suggests, “If someone wants to invest in the Greater China region, then lump sum can be invested because the valuations are dirt cheap. However, this investment has to be in the satellite portfolio because we don’t know when exactly the bounce-back will happen.”

He further advises that investors should look at a horizon of 6-7 years when venturing in this region.

However, experts do have a word of caution. “Greater China region is a good spot but only for those who understand the political , economic and regulatory risks. Right from Taiwan to China, some exposure can be taken, but it should be more of a tactical call for savvy investors rather than for everybody,” said Prableen Bajpai, founder of FinFix Research & Analytics.

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint.
Download The Mint News App to get Daily Market Updates.

More
Less

Subscribe to Mint Newsletters

* Enter a valid email

* Thank you for subscribing to our newsletter.

First article



Source link

Related Posts

ELSS mutual fund inflows drop over 48% in July: Should you invest?

by MtR
August 10, 2022
0

According to monthly data issued by the Association of Mutual Funds in India, net positive inflows to equity mutual funds...

How To Handle Erratic Bond Markets – Fortune India

by MtR
August 9, 2022
0

How To Handle Erratic Bond Markets  Fortune India Source link

Money Guru: 10 funds for financial independence, this 15th August – details – Zee Business

by MtR
August 9, 2022
0

Money Guru: 10 funds for financial independence, this 15th August - details  Zee Business Source link

Sen. Rubio questions Thrift Savings Plan’s exposure to Chinese companies in new mutual fund window

by MtR
August 9, 2022
0

The $706.9 billion Thrift Savings Plan, the retirement plan for 6.6 million federal employees and members of the uniformed services,...

The investment strategy of Sanctum Wealth’s Shiv Gupta

by MtR
August 8, 2022
0

He was referring to his acquisition of the wealth management arm of Royal Bank of Scotland (RBS) in India in...

Load More
  • Trending
  • Comments
  • Latest

Bank of England tells ministers to intervene on digital currency ‘programming’

June 21, 2021

Tips for checking smoke alarms during daylight saving time

March 12, 2022

GLOBAL MARKETS-U.S. stocks follow Europe up; Treasury yields rise, dollar firm

July 9, 2021

What will Durham County education bonds pay for? A full list

July 8, 2022
African currencies week ahead: Zambia's kwacha seen on back foot, Kenyan shilling up – Business Recorder

African currencies week ahead: Zambia's kwacha seen on back foot, Kenyan shilling up – Business Recorder

0
Maxum Foods releases Global Dairy Commodity Update for June

Maxum Foods releases Global Dairy Commodity Update for June

0
Letter: Perpetual bonds can help states fight hunger

Letter: Perpetual bonds can help states fight hunger

0
United Kingdom ETFs Are Riding the Re-Opening Momentum

United Kingdom ETFs Are Riding the Re-Opening Momentum

0

Investment in overseas real estate surges : The DONG-A ILBO

August 11, 2022

U.S. inflation CPI report, Wall Street, currencies

August 10, 2022

Alberta oil production set new record in first half of 2022

August 10, 2022

Industrial Lubricants Market to Reach $71 Billion by 2027.

August 10, 2022

Recent News

Investment in overseas real estate surges : The DONG-A ILBO

August 11, 2022

U.S. inflation CPI report, Wall Street, currencies

August 10, 2022

Alberta oil production set new record in first half of 2022

August 10, 2022

Categories

  • Asia
  • Bonds
  • Canada
  • Commodities
  • Cryptocurrencies
  • Currencies
  • Emerging Markets
  • ETFs
  • Europe & Middle East
  • IPOs
  • Latin America
  • Mutual Funds
  • Personal Finance
  • Real Estate
  • Retirement
  • Spending & Saving
  • Stocks
  • U.S. Markets
  • Privacy & Policy
  • About Us
  • Contact Us
  • Advertise with us

© 2021 Copyright Market-Reporter

No Result
View All Result
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate

© 2021 Copyright Market-Reporter