Dozens of mutual funds focusing on China have emerged in recent years, making China the most popular nation for single-country emerging markets funds.
Morningstar Inc. counts 34 funds that either include "China" in their name or have more than 20 percent of their stock assets invested in China.
Morningstar fund analyst Bill Rocco cautions that funds focusing on specific foreign markets can be highly volatile, and for most investors should supplement rather than substitute for an otherwise well-diversified portfolio.
"Owning a China fund is like owning an individual stock," Rocco said. "The risk- reward profile is very high."
While neither of these is a China-specific fund, here are two regional funds with hefty China stakes that Morningstar lists among its analyst picks:
FUND: T. Rowe Price New Asia (PRASX)
ASSETS: $1.6 billion
YEAR-TO-DATE LOSS: -7.9 percent
3-YEAR ANNUALIZED LOSS: -8.25 percent
5-YEAR ANNUALIZED RETURN: 2.44 percent
EXPENSE RATIO: 0.96 percent
MINIMUM INVESTMENT: $2,500
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FUND: Matthews Pacific Tiger (MAPTX)
ASSETS: $1.1 billion
YEAR-TO-DATE LOSS: -12.76 percent
3-YEAR ANNUALIZED LOSS: -8.46 percent
5-YEAR ANNUALIZED RETURN: 2.29 percent
EXPENSE RATIO: 1.10 percent
MINIMUM INVESTMENT: $2,500
Here are two broader funds with substantial holdings in China and other emerging markets that Morningstar counts as analyst picks:
FUND: T. Rowe Price Emerging Markets Stock (PRMSX)
ASSETS: $2.1 billion
YEAR-TO-DATE LOSS: -10.65 percent
3-YEAR ANNUALIZED LOSS: -15.61 percent
5-YEAR ANNUALIZED RETURN: 1.7 percent
EXPENSE RATIO: 1.24 percent
MINIMUM INVESTMENT: $2,500
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FUND: American Funds New World (NEWFX)
ASSETS: $9.1 billion
YEAR-TO-DATE LOSS: -8.06 percent
3-YEAR ANNUALIZED LOSS: -7.04 percent
5-YEAR ANNUALIZED RETURN: 4.06 percent
EXPENSE RATIO: 0.95 percent
MINIMUM INVESTMENT: $250
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Note: Returns through Thursday, Feb. 19.
Source: Morningstar Inc.
