“The secret sauce is China, and with EMQQ you’re getting a triple dose,” Balchunas said.
Buyers are retail investors, financial advisors and ETF strategists, according to Kevin Carter, manager of the fund. “The emerging market consumer — that’s a story that advisors have long understood,” he said.
Tech names have pushed the MSCI China Index near its highest level since 2015, according to data compiled by Bloomberg. Mark Mobius, executive chairman of Templeton Emerging Markets Group, argued in November that the threat of a trade war with Trump would compel China to accelerate the pace of opening up its markets.
Still, emerging market and tech investors can be fickle, as they’ve shown in the past by fleeing the assets as quickly as they’ve jumped in. After making his bullish call on onshore Chinese shares in November, Mobius called Chinese tech stocks “expensive” in an April 6 interview on Bloomberg TV.
“EM countries are going to be subject to macroeconomic commodity and currency forces, and China has some unique risks in its financial system,” Carter said. “But apart from those things, I think both groups have room to run.”
This article was provided by Bloomberg News.