To The Moon

China’s equity markets have been heating up. On August 22, the Shanghai Composite Index briefly broke above 3,800, reaching its highest closing level since 2015. On the same day, the total market capitalization of A-shares surpassed RMB 100 trillion for the first time, fueled by record margin financing and strong investor inflows. Turnover surged to nearly RMB 2.8 trillion, underscoring renewed enthusiasm across both institutional and retail investors.

Against this backdrop, many investors are asking the same question: How should I gain exposure to China? Should I chase hot themes, or stick to a diversified approach? For most, the practical answer is not to pick individual stocks, but to use Exchange-Traded Funds (ETFs)—a tool that allows broad exposure while managing risk.

This note outlines three practical ETF allocation strategies—conservative, balanced, and aggressive—tailored to different risk profiles.

Why ETFs as a Starting Point?

• Diversification: Each ETF holds dozens, sometimes hundreds, of companies—reducing single-stock risk.

• Liquidity: ETFs trade intraday like stocks, offering flexibility compared to traditional mutual funds.

• Breadth: China-focused ETFs are listed globally across the U.S., Hong Kong, and mainland exchanges, giving investors multiple access points.

Allocation Strategies by Risk Profile

🟢 Conservative: Stability First

• Target allocation: ~30% equities / ~70% fixed income

• ETF mix:

  • 70% in Chinese sovereign or USD-denominated bond ETFs (e.g., China Government Bond ETF $ICBCCSOP CGPB(03199)$ .HK or ChinaBond ETF $PENGYANG CHINA BOND - 30 YEAR TREASURY BOND TRADING OPEN INDEX SECURITIES INVESTMENT FUND(511090)$ .SH)

  • 30% in large-cap equity ETFs such as CSI 300 ETF ( $HUATAI-PINEBRIDGE CSI 300 INDEX TRADING SECURITIES INVESTMENT FUND(510300)$ .SH) or HSCEI ETF ( $HSCEI ETF(02828)$ .HK)

• Rationale: Bonds anchor the portfolio with stable cash flow, while limited equity exposure captures China’s long-term growth without introducing excessive volatility.

🟡 Balanced: Growth with Risk Control

• Target allocation: ~50% broad-market equities / ~30% bonds / ~20% thematic sectors

• ETF mix:

  • 50% in CSI 300 ETF ( $HUATAI-PINEBRIDGE CSI 300 INDEX TRADING SECURITIES INVESTMENT FUND(510300)$ .SH) or Hang Seng Tech ETF ( $CSOP HS TECH(03033)$ .HK)

  • 30% in Chinese bond ETFs

  • 20% in growth themes such as China New Energy ETF or AI-related ETFs( $HUAXIA CSI ARTIFICIAL INTELLIGENCE THEME TRADING OPEN INDEX SECURITIES INVESTMENT FUND(515070)$ .SH)

• Rationale: This structure balances broad-market exposure with stable fixed income, while leaving room for high-growth themes. Suitable for investors seeking upside but mindful of drawdowns.

🔴 Aggressive: Maximizing Upside

• Target allocation: 80%+ equities / minimal bonds

• ETF mix:

  • 40% in Hang Seng Tech ETF ( $CSOP HS TECH(03033)$ .HK)

  • 40% in U.S.-listed China ADR ETFs such as $KraneShares CSI China Internet ETF(KWEB)$ .US (China Internet ETF)

  • 20% in thematic ETFs such as AI or New Energy ETFs ( $HUAXIA CSI ARTIFICIAL INTELLIGENCE THEME TRADING OPEN INDEX SECURITIES INVESTMENT FUND(515070)$ .SH)

• Rationale: Designed for investors with higher risk tolerance, this approach concentrates on technology and growth sectors. Potential returns are higher, but volatility and drawdowns can be significant.

How to Monitor Portfolio “Health”

After building an allocation, regular monitoring is essential:

• Sharpe Ratio – risk-adjusted return efficiency

• Volatility – overall portfolio fluctuations

• Maximum Drawdown – peak-to-trough loss, reflecting downside risk

Most brokerage platforms (including Tiger Trade) provide these metrics in real time, making it easier to track performance.

Rebalancing Discipline

Market moves can distort allocations. For example, if your tech ETF allocation grows from 40% to 60% due to a rally, trimming back to your target weight helps lock in gains and control risk. A simple rule: review allocations every 3–6 months and rebalance to your original targets.

Finding Your “Comfort Zone”

The key to sustainable investing is aligning your portfolio with your own risk tolerance:

• Conservative → heavier bonds, modest equities

• Balanced → broad market core plus selective themes

• Aggressive → growth-focused, higher volatility

ETFs offer a transparent and efficient way to implement all three.

Invest in China with Tiger—your one-stop solution

Bullish on China but not sure how to allocate? With one Tiger account, you can invest in a range of China-related assets:

A-shares Connect: $HUATAI-PINEBRIDGE CSI 300 INDEX TRADING SECURITIES INVESTMENT FUND(510300)$ ; $CARD IN 500 EXCHANGE-TRADED INDEX SECURITIES INVESTMENT FUND(510500)$ ; $E-FUND GEM TYPE OPEN INDEX TRADING SECURITIES INVESTMENT FUND(159915)$ $Contemporary Amperex Technology Co.,Ltd.(300750)$ ; $Kweichow Moutai Co.,Ltd.(600519)$

Hong Kong Market: $Xinjiang Tianshun Supply Chain Co.,Ltd.(002800)$ $HSCEI ETF(02828)$ $CAM MSCI A50(02839)$ ; $TENCENT(00700)$ , $MEITUAN-W(03690)$ , $CHINA MOBILE(00941)$

US Markets: $Xtrackers Harvest CSI 300 China A-Shares ETF(ASHR)$ , $KraneShares CSI China Internet ETF(KWEB)$ , $iShares China Large-Cap ETF(FXI)$ , $Alibaba(BABA)$ , $BIDU-SW(09888)$ $PDD Holdings Inc(PDD)$

In addition, Tiger Trade’s signature features—TigerAI and Recurring Investment—make it easier to build exposure to Chinese assets:

• TigerAI Investment Assistant: New to Chinese assets? Ask anytime—e.g., “Which ETFs track the CSI 300?” or “Which China ADRs are trending lately?”—and get answers instantly.

• Recurring Investments for HK stocks & ETFs: Worried about timing? Tiger Trade supports daily/weekly/monthly recurring plans for Hong Kong stocks and ETFs to average your cost, build long-term positions, and pursue steadier outcomes.

Disclaimer: This article provides market insights and investment ideas, not financial advice. Investing carries risks—please invest prudently.