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BEST CHINA ETF?

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Question asked 11/04/2026

BEST CHINA ETF?

With this illegal war and its ramifications looking like it could continue for some time yet, China looks like a model of stability. It is decreasing its dependence on oil, and investing heavily in alternative energy - which is much cheaper than oil. Half the data centres planned for construction in the US have either been cancelled or are on pause with high energy costs and components availability problems. I'm actively looking to invest in China via an ETF registered in Australia. I now have 4 in my system (which is a very demanding and time consuming exercise): CETF; CNEW; DRNG; and IZZ. First off, are there any others I should be aware of? Secondly, which do you think is better, and why? DRNG (odd ticker!) has only been listed since 8 May 2025, and sometimes IZZ performs really well and my latest observations - but otherwise much like the little girl with a curl right in the middle of her forehead! Many thanks for your excellent analysis on investing issues. I plan to be with you for a very long time.

Answer

Hi Bill,

In our opinion the (ASX:IZZ) and (ASX:CNEW) are the cleanest ASX-listed ways to gain direct exposure to a bullish China view.

iShares China Large-Cap (ASX:IZZ): Tracks large-cap Chinese stocks (banks, SOEs, Tencent/Alibaba) and is more cyclical, more liquid, benefits most from broad China stimulus and an economic recovery.
VanEck China New Economy ETF (ASX:CNEW): Focuses on consumer, tech, healthcare. It’s higher growth, has less state-owned exposure and is more aligned to structural trends in China.

These two ETFs provide more direct exposure to China compared to broader emerging market funds like IEM and VGE, where China is diluted within a wider portfolio. They also offer a cleaner way to express a China view, with IZZ providing a macro recovery play and CNEW targeting structural growth. In addition, they allow for more targeted positioning than ASIA, which blends China exposure with other regional tech markets such as Korea and Taiwan.

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iShares China Large-Cap (IZZ) v VanEck China New Economy ETF (CNEW)

LAST UPDATED 09/04/2026 11:26

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