VanEck Vectors ChinaAMC China Bond ETF (CBON)
CBON Price and Sentiment
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Finding the income with fixed income is becoming a daunting task in 2021, particularly for investors sticking with Treasuries. The safest government debt isn't yielding much, crimping income investors in the process.
Shares in China continue to post sharp year-to-date losses vs. an otherwise upside bias for global stocks, based on a set of exchange-traded funds tracking the world's major equity regions through yesterday's close (Aug. 25). Some investors see opportunity in beaten-down shares, but there's still a wide-ranging debate as the market prices in higher uncertainty driven by the vagaries of Beijing's evolving policy agenda.
Emerging markets offer attractive alternatives to fixed income investors searching for yield amid the trillions of dollars of negative-, zero-, and low-yielding debt globally. Within emerging market hard currency investment grade bonds, we think it is prudent to be shorter duration or at least hedge the Treasury risk component, given the low yield per unit of duration today.
Most market participants and index providers consider China to be an emerging market, and by many traditional measures, it is. The yield and duration profile of Chinese onshore bonds is attractive.
U.S. government debt has long been a go-to safe haven both domestically and internationally. China could be challenging for that top spot as more global investors flock to the country's bonds, available in an ETF wrapper via the VanEck Vectors ChinaAMC China Bond ETF (CBON).
Chinese yuan has come across as the best currency ETF of 2020.
While other nations continue to struggle with rising cases, China might be the ideal play for safe haven bond alternative ETFs like the VanEck Vectors ChinaAMC China Bond ETF (CBON). CBON seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the ChinaBond China High Quality Bond Index.
As China continues to recover from the COVID-19 pandemic, more investors are looking for opportunities in the country's bond market. Global investors in particular have been piling into Singapore-based CSOP Asset Management's first exchange traded fund (ETF), which reached $1 billion in assets.
Bonds might be the obvious choice for a safe haven, income-producing asset, but where do you go when you want to get higher yields? China might have the answer with their latest bond offering, which is garnering the interest of U.S. investors.
World's largest asset manager and global wealth management firm BlackRock, Inc. (NYSE: BLK) is bullish on China's domestic bond market, reported CNBC. In the interview on CNBC's Street Signs Asia, BlackRock’s head of Asian credit, Neeraj Seth said, "We still see China bond market to be fairly attractive.