Krungthai Asset Management (KTAM) recommends investing in the Chinese stock and fund markets in the second half of this year, expecting the country's recovering exports and the government's accommodative monetary policy to help boost the economy.
Chavinda Hanratanakool, chief executive of KTAM, said investors should not overlook the Chinese capital market as there is a myriad of factors to support the country's economic growth in the second half, including recovering exports, the government's economic stimulus, low inflation and China's potential to become an important source of raw materials.
She said although the economy may still be affected by strict lockdown measures, the Chinese government has started providing compensation and tax incentives to support businesses affected by the lockdowns.
With China's inflation rate the lowest in the world at just 2.1%, the government can continue to drive stimulus policies, Mrs Chavinda said.
Moreover, when Chinese ports such as Shanghai begin to resume activities after lockdowns loosen, exports should increase.
With the percentage weight of China in the MSCI Index at only 3.5%, this reflects most investors overlooking the Chinese economy's potential for growth, she said.
The time is right to invest in Chinese stocks, bonds and yuan, said Mrs Chavinda.
KTAM advises three Chinese funds for investment: KT-Ashares, KT-CHINA and KT-CHINABOND.
KT-Ashares has Allianz Global Investors Fund - Allianz China A-Shares as the master fund. The master fund focuses on long-term investment in A-share stocks.
KT-CHINA invests in BGF China Fund as the master fund with an aim to generate the highest total returns by investing in companies based in China or benefiting from Chinese economic growth.
Both KT-Ashares and KT-CHINA provide retirement mutual fund variations for investment.
KT-CHINABOND has a policy to invest in BGF China Bond Fund as the master fund. The master fund invests in yuan currency bonds or businesses that operate in China.
