It was a week to forget for most investors. The major stock indices in the U.S. plunged into bear market territory. Elsewhere in the world, the stock markets were similarly disastrous. Alternative investment products like gold and cryptocurrencies also failed to provide the holders with much consolation. With the spread of COVID-19 escalating rapidly in Europe and the sense that there are more infected in the U.S. that have yet to be confirmed by tests, inevitably, fear is in the air.
The announcement on Thursday by the World Health Organization that the novel coronavirus outbreak was now a pandemic came as no surprise to many, but still reinforced the notion that the situation had worsened around the world. The apparent lack of coordinated or substantive policy responses by the Trump administration, European leaders, as well as major Asian economies like Japan and South Korea resulted in confidence sinking further to the abyss.
Stocks of Chinese companies (NYSEARCA:CQQQ) (FXI) (NASDAQ:MCHI), of course, were unable to escape the strong drag globally, but they had comparatively held up better than U.S. ones.
It wasn't a one-week fluke. Looking back three weeks, the three ETFs representing Chinese listed companies have suffered losses, but outperformed the SPDR S&P 500 ETF (SPY) and SPDR Dow Jones Industrial Average ETF (DIA) by wide margins.
The Chinese Internet sector representative ETF, the KraneShares CSI China Internet ETF (NYSEARCA:KWEB), was similarly caught in the global meltdown, plunging 8.67 percent for the week. A small rebound on Friday helped offset hefty losses the day before. The small consolation is its relative outperformance over the SPY and DIA ETFs. Unlike in the past weeks when there were component stocks among the key holdings of the KWEB ETF that were able to eke out positive gains in a down week, this time around, there
