EWH Faces Hong Kong Uncertainty

Sep. 06, 2022 7:00 AM ETiShares MSCI Hong Kong ETF (EWH)AAGIY, AAIGF, HKXCF, HKXCY

Summary

  • The Hong Kong market is getting heavily shorted as China smarts from economic concerns and delisting, where accounting cooperation seems to be building, keeping down stocks on those markets.
  • EWH captures a lot of typical HK exposures including insurance but also a lot of real estate.
  • As China becomes more involved, real estate will be an area to focus on as HK is an extraordinarily expensive market.
  • Governance changes could be bad for real estate, and COVID-19 as well as China clampdown on HSBC could all be economic hits to HK prosperity.
  • However, shorting can mean a squeeze is coming. Still, we don't speculate, and unfortunately, the benefits of insurance exposures in a rate hike environment are not present for EWH.
  • Looking for a helping hand in the market? Members of The Value Lab get exclusive ideas and guidance to navigate any climate. Learn More »

Hong Kong Cityscape view from sky

CHUNYIP WONG

Published on the Value Lab 3/9/22

The iShares MSCI Hong Kong ETF (NYSEARCA:EWH) is unsurprisingly a little turbulent. Hong Kong markets are heavily shorted around the uncertainty of China's growing involvement in their governance and the HK market's

EWH holdings

Holdings (iShares.com)

EWH

Fixed Income Portfolio Duration (iShares.com)

EWH sectors

Sectors (iShares.com)

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This article was written by

Author of The Value Lab
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Valkyrie Trading Society seeks to provide a consistent and honest voice through this blog and our Marketplace Service, the Value Lab, with a focus on high conviction and obscure developed market ideas.

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