iShares FTSE/Xinhua China 25 Index, China Mobile, China Life and PetroChina continue to profit from China's strong cash surpluses in global trade.
StreetAuthority's subscriber-only investment newsletter picks iShares FTSE/Xinhua China 25 Index (FXI) as one of the world's top performing investments in 2007. StreetAuthority points out that in addition to a growing Chinese middle-class of over 300 million consumers, China continues to enjoy booming foreign trade. After joining the World Trade Organization in 2001, China's government has reduced tariffs and made it easier for foreign companies to invest directly in China.
StreetAuthority compares China emergence as an economic superpower to America's economic expansion in the late 19th century as the U.S. became the world's largest economy.
Mad Money's Jim Cramer (booyah, booyah) recognizes the risks of a red-hot economy like China's, but affirms that the Chinese market offers a great opportunity to jump in once FXI's unit price settles down.
The Motley Fool's Will Frankenhoff believes that companies in FXI like China Mobile, China Life and PetroChina are attractively valued in relation to their growth prospects, particularly since these companies service China's domestic market.
A recent report by the Xinhua Economic Information Department sees China's $2.5 trillion economy posting an impressive 9.5% gain in 2007, down slightly from 10.5% in 2006. Retail sales in China will grow by 15%, an example of the consumer demand that continues to fuel Chinese business profits.
China's tremendous economic growth should continue for years to come as it approaches the level of wealth of the U.S. or Western Europe. The key to investing in this hyper-growth market is the diversification found in FXI's basket of blue-chip Chinese companies.
