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  • Technology Stocks Hatching Out Of The Resilience Phase Of China 0 comments
    Oct 11, 2013 1:57 AM

    The Chinese economy has been doing very well in terms of the degree of the marketing of Technological products. The economy had been showing a rather slow growth rate but it has seemed to pull itself out of that slump and is gradually progressing towards the growth path. One of the many factors responsible for the positive inclination is the liberalization of its capital markets. There have been huge inflows of investments into its economy and as a result this has lead to a certain amount of misbalancing. As far as the currency mark up goes, Yuan is the ninth most active currency according to the Bank for International Settlements triennial survey.

    What the investment-led rebounding of the economy has done, is that it has further led to the expansion of credit. At present the economy is seeing an outstanding credit of 200% of GDP from 130%.

    The Chinese industry has progressed and has shown rewards of profitability. Not only this, but the Constructions sector is overwhelmingly increasing its productivity level and surpassing the demand level, this sector at present accounts for 9% of GDP of the economy. China is a known master of the technology influence. The recent development of the Internet based growth has led to bulkier inflow of investments which has virtually pumped in the extra nourishment into the technology sector. 100,000 shares have been added to the NASDAQ China Technology ETF (NASDAQ:QQQC) this week and this has led to a 40% increase in the number of its shares. China is the umpteen markets for smart phones and a phenomenal number of internet users, an approximate 500 million; this brings it to be the most influenced market of technology related products on the global front. The Internet rulers; Google, Facebook, Priceline etc. have managed to perform incredibly well this year and have brought major inputs into the Internet World. The ETFs belonging to this sector, CHIB Fund etc. have been heavily drowsed by the level of investments seeping to the technology sector. As on 4/10/13 the top ten major securities of the QQQC (China technology fund) are BAIDU.COM, INC, TENCENT HOLDING., SINA CORP US, QIHO 360 TECHNO.., LENOVO GROUP LT., SOHU.COM INC, DIGITAL CHINA H., ZTE CORPORATION, NETEASE.COM and INC. ASM PACIFIC TEC. What is actually to be seen is that TENCENT HOLDINGs has the second largest share of the fund at 8.48% and BAIDU.COM the top most share holder, at 8.76%. So what is reflected here is the affirmative growth of invest china technology sector.

    As per the forecasts for the second largest economy of the world by the International Monetary Fund, the economy is by all means expected to grow 7.75 per cent this year. Despite the difficulty that China has to face regarding the Global business environment, it is anticipated to sustain its level of stability and petite growth rates. The figures relating to industrial added value and fixed asset investment are showing modest improvement.

    Global X China Technology ETF [QQQC]operating at an annual fee of 0.65% is designed to track the performance of the technology sector in China. The China technology fund provides exposure to the major Internet companies, electronic office equipment, miconductors, telecommunications equipment, telecommunications firms, and manufacturer if software and hardware companies. This fund yields as per the cumulative returns of the NASDAQ OMX China Technology Index. The industry break down of the fund in the various sectors shows the Internet sector scoring 37.47% of the assets, Hardware & Software 26.70%, Telecommunication Services 21.79%,Technology 5.88% and Information Technology 5.02% and Consumer 2.02% of the assets.

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