Top funds you could choose

MOST experts believe investors should have some money in China, either through an investment f und or st ock market l i st ed investment trust. But they disagree on how much and the ‘best’ individual funds.

Among the most bullish is FundExpert’s Brian Dennehy who says 20 per cent exposure to China is ‘fine’. His favourite funds include Baillie Gifford China and Matthews China Small Companies – the latter feeding off the growth in entrepreneurial companies operating within the technology, health care, automation and education sectors. An alternative route, Dennehy suggests, is through an emerging markets fund with exposure to China – for example M&G Global Emerging Markets.

Shore’s Ben Yearsley s ays ‘adventurous investors’ should be looking at between 20 and 25 per cent exposure across China, Asia and emerging markets. China specific funds, he likes, include Fidelity China Consumer and Matthews China Small Companies.

FundCalibre’s Darius McDermott likes FSSA Greater China Growth, Invesco China Equity and investment trust Fidelity China Special Situations. Broader funds with Chinese holdings include JP Morgan Asia Growth (48 per cent).

Interactive Investor’s Dzmitry Lipski says investors should have up to 15 per cent of their investments in Asia. But he urges investors to bear in mind that many global funds have significant Far Eastern holdings.

For example, trust Scottish Mortgage has 24 per cent of its assets in China. ‘When deciding how much to invest in a Chinese or Asian fund, think about the exposure you may already have,’ he warns. His preferred China trusts are Fidelity China Special Situations and Pacific Assets.