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Topic: How To Invest

ISHARES FTSE/XINHUA CHINA 25 INDEX FUND $44.32 – New York Exchange symbol FXI

ISHARES FTSE/XINHUA CHINA 25 INDEX FUND $44.32 (New York Exchange symbol FXI; buy or sell through brokers) is an ETF that aims to track the FTSE/Xinhua China 25 Index, which is made up of the 25 largest and most liquid Chinese stocks. All of the stocks in the index trade on the Hong Kong exchange. Some also trade as American Depositary Receipts (ADRs) on the New York exchange.

The fund’s top holdings are China Mobile, 9.7%; China Construction Bank, 9.6%; CNOOC, 8.3%; Industrial & Commercial Bank, 8.0%; China Life, 5.7%; Petrochina, 4.3%; Ping An Insurance, 4.2%; Bank of China, 4.2%; China Petroleum & Chemical, 4.2%; and China Unicom Hong Kong, 4.1%.

The fund’s holdings give it the following industry breakdown: Financials, 47.3%; Telecommunications, 17.7%; Oil and Gas, 16.7%; Basic Materials, 10.3%; Industrials, 6.1%; and Consumer Services, 1.8%. The ETF has an expense ratio of 0.72%.

China’s economy is forecast to grow 9.7% in 2011, and the long-term outlook for Chinese stocks is strong.

iShares FTSE/Xinhua China is a buy for safety-conscious investors willing to accept some risk.

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