Posted on 10/01/2010
The cover of this week's The Economist magazine reads "How India's Growth Will Outpace China's”. Interestingly, this is the second cover from The Economist within the last couple of months featuring the economic competition between these two nations. You may recall the cover back in August depicting an arm wrestling match with the headline "Contest of the Century: China v India." To see how the race is going so far, only ten years into this Century, we have compiled a list of Indian and Chinese ETFs and have looked at the performance numbers between the two. As you can see in the lists below, there are currently 20 Chinese-based ETFs and 9 Indian specific ETFs that you can use to gain exposure to these growing nations.
Looking at the returns year to date of the funds making up this list, we see that China and India are neck in neck, at least based on ETF performance. The best performing fund so far in 2010 is the Global X China Consumer ETF (CHIQ) which saw a return of 23.51%, and puts a point on China’s side. However, right behind it is one for India with the iShares S&P India Nifty 50 Index Fund (INDY) posting a return of 21.57%. If we focus solely on the top 10 performing funds from this list, we find that the strength is leaning slightly to India’s side as it represents 6 out of these 10 names, while China accounts for the remaining 4. Simply put, the both countries are strong. If you can't decide which one you think will win in the race, split the difference and purchase the First Trust ISE Chindia Index Fund (FNI) which has about a 50% exposure to each of these: the best of both worlds.