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China’s economy, despite some recent moderation, continues to be a global powerhouse with significant growth potential, especially in the technology and consumer sectors. Key factors contributing to China’s economic strength include its massive domestic market, robust manufacturing capabilities, and ongoing technological advancements. This long-term potential makes China an attractive investment opportunity for those looking to diversify their portfolios. The country’s growing middle class is driving increased consumption, while its leadership in fields like e-commerce, artificial intelligence, and renewable energy continues to expand. For many investors, picking individual stocks can be challenging. However, provide a convenient and diversified way to gain exposure to Chinese stock and bond markets. ETFs offer a broad selection of investments, reducing the risk associated with individual stock selection while still capitalizing on China’s economic growth. As investors, we can gain exposure to Chinese stock and bond markets by investing in some Singapore-listed ETFs.  Government Bond Index (in SGD; distributing) Year Treasury and Policy Bank Bond Index Connect China 80 Index China is the world’s second-largest bond market and one of the most liquid markets. Investors who wish to gain exposure to this part of the market can consider the ICBC CSOP FTSE Chinese Government Bond Index ETF. The ICBC CSOP FTSE Chinese Government Bond Index ETF seeks to replicate the performance of the FTSE Chinese Government Bond Index. The bonds in the ETF are credit-rated as A1. This index measures the performance of fixed-rate government bonds issued in mainland China, making this ETF an easy way to invest in the Chinese government bond market. There are two classes of ETFs – distributing and accumulating. The distributing class distributes the income to unitholders while the accumulating one reinvests the income. Here are further details of the ETF: The ICBC CSOP FTSE Chinese Government Bond Index ETF has an expense ratio of 0.26% and a low tracking error of 0.03%. The tracking error shows how well the ETF tracks the benchmark index over time. The lower the expense ratio and tracking error, the better for investors. Here’s a snapshot of the annual performance of the ETF: The NikkoAM-ICBCSG China Bond ETF is an ETF that seeks to replicate the performance of the ChinaBond ICBC 1-10 Year Treasury and Policy Bank Bond Index. This index is a mix of Chinese government bonds and bonds issued by China’s three policy banks: The three policy banks are state-owned entities with the same international credit rating as the Chinese government. Like the ICBC CSOP FTSE Chinese Government Bond Index ETF, the NikkoAM-ICBCSG China Bond ETF has both a distributing and accumulating class. The table below provides more details about the ETF: ZHD (in USD) 0.06% (RMB share class) Short-term bonds typically have lower volatility. Since the ETF is designed to track an index comprising bonds with a maturity of less than 10 years, it results in higher risk-adjusted returns. The five-year annualised return of the index was 4.34%, with volatility during the same period at 1.94%, giving a risk-adjusted return of 2.24% (all data as of 30 June 2023). Listed in December 2020, the Lion-OCBC Securities Hang Seng TECH ETF is an ETF designed to track the Hang Seng TECH Index. The index represents the 30 largest technology-themed companies listed in Hong Kong, many of which have substantial operations and revenue streams within mainland China. This ETF offers investors a streamlined way to participate in the growth potential of China’s dynamic technology sector. Some of the companies from the index include well-known names like Alibaba, JD.com, and Xiaomi. Here are the top 10 stocks that are part of the Lion-OCBC Securities Hang Seng TECH ETF: The Lion-OCBC Securities Hang Seng TECH ETF is available in both Singapore dollars (ticker: HST) and US dollars (ticker: HSS). The ETF has an expense ratio of 0.58% per year and an annualised tracking error of 0.06%. Currently, the ETF doesn’t have any dividend distribution. Since its inception, the Lion-OCBC Securities Hang Seng TECH ETF has not performed well due to a myriad of reasons, including China’s economic slowdown. The country’s challenges gave rise to an annualised return of -20.7% for the ETF (as of April 2024). However, those with a long-term investment horizon and a focus on technology-driven innovation may want to take a second look at the Lion-OCBC Securities Hang Seng TECH ETF. The Lion-OCBC Securities China Leaders ETF aims to track the performance of the Hang Seng Stock Connect China 80. The index measures the overall performance of 80 of the largest Chinese companies by market capitalisation listed in Hong Kong and/or mainland China that are eligible for Northbound or Southbound trading under the Stock Connect schemes. Some of the largest companies in the index include Kweichow Moutai, Meituan, and Tencent. Below is a list of the top 10 stocks that are part of the Lion-OCBC Securities China Leaders ETF, which was listed in August 2021: The Lion-OCBC Securities China Leaders ETF is available in both Singapore dollars (ticker: YYY) and Renminbi (ticker: YYR), with an expense ratio of 0.62% per year and an annualised tracking error of 0.86%. The ETF currently pays an annual distribution. Since its inception, the Lion-OCBC Securities China Leaders ETF has had an annualised return of -7.9% (as of April 2024). Before investing in China-focused ETFs, it’s crucial to consider the associated risks. The Chinese stock and bond markets can offer intriguing investment opportunities, but they also come with their own set of challenges. Interest rate risk is one such challenge, as changes in interest rates can affect the value of bonds. Typically, bond prices fall when interest rates rise. Another risk to consider is currency risk. Investing in foreign currencies exposes investors to fluctuations between that currency and the Singapore dollar, which can impact returns. Additionally, regulatory risk is a significant factor, particularly in China’s constantly evolving regulatory environment for technology companies. Regulation changes can significantly impact underlying stocks’ performance and lead to market volatility, as seen during the tech rout of 2021. Therefore, it is essential to thoroughly review the factsheets and prospectuses of the ETFs to understand their potential rewards and risks before making an investment. is not a recommendation from us to buy or sell any of these stocks. For investors who are keen to find out more, you should continue researching about them before making your investment decisions. With over 25,000 subscribers, has expanded since 2020 to bring you more than just market insights, updates on sector and stock performances, plus all the happenings in Singapore's securities market, tailored for individual investors like you.