New Opportunities for Investors in China’s Growing Electric Vehicle Market

China’s electric vehicle (EV) market continues to gain momentum, attracting the attention of investors worldwide. While there are significant hurdles for retail investors to overcome, several options are emerging that allow them to be part of China’s EV growth story.

One such option is investing in exchange-traded funds (ETFs) that focus on Chinese EV companies. The Amplify Lithium & Battery Technology ETF (BATT) and CoreValues Alpha Greater China Growth ETF (CGRO) are two funds that enable U.S. and Europe-based investors to gain exposure to restricted Chinese shares. BATT provides broad exposure to the EV supply chain, with top holdings including battery-making giant Contemporary Amperex Technology (CATL) and car maker BYD. CGRO also includes BYD and CATL in its holdings, as well as smartphone maker Xiaomi.

According to Kingsley Jones, a veteran investor and portfolio manager, BYD is a particularly attractive investment opportunity. Despite a recent slump in its stock price, Jones believes the valuation is reasonably attractive for the growth rate that BYD is posting. He also points out that BYD is experiencing solid sales momentum not only in China but also in export markets like Australia, where electric vehicle penetration rates are high.

In addition to ETFs, other Chinese EV companies present opportunities for investors. CATL, for example, has secured partnerships with major automakers such as BMW, Mercedes, and Honda. However, buying shares in CATL can be challenging for retail investors due to restrictions. Nevertheless, Jones emphasizes that ETFs with concentrated positions, such as BATT and CGRO, can offer exposure to these companies.

Analysts are generally positive about the prospects of the ETFs’ holdings. The median analyst rating for BATT indicates a buy, with a price target suggesting a 48.7% upside. Similarly, CGRO is expected to rise by 44.3% over the next 12 months.

As China’s EV market continues to flourish, new opportunities for investors are emerging. ETFs focusing on the EV supply chain and specific Chinese companies provide avenues for retail investors to participate in this growth potential. With the right investment strategy, investors can take advantage of China’s position as a leader in the electric vehicle industry.

Frequently Asked Questions (FAQs) – China’s Electric Vehicle Market and Investing Options

1. What are some investment options for retail investors looking to be part of China’s electric vehicle (EV) growth story?
Retail investors can consider investing in exchange-traded funds (ETFs) that focus on Chinese EV companies. Two such ETFs are the Amplify Lithium & Battery Technology ETF (BATT) and CoreValues Alpha Greater China Growth ETF (CGRO). These funds enable U.S. and Europe-based investors to gain exposure to restricted Chinese shares.

2. What companies are included in the BATT and CGRO ETFs?
Both BATT and CGRO include top Chinese EV companies such as battery-making giant Contemporary Amperex Technology (CATL), car maker BYD, and smartphone maker Xiaomi in their holdings.

3. Why is BYD considered an attractive investment opportunity?
According to veteran investor Kingsley Jones, BYD is seen as a particularly attractive investment opportunity. The valuation is reasonably attractive for the growth rate that BYD is posting. Furthermore, BYD is experiencing solid sales momentum not only in China but also in export markets like Australia.

4. Can retail investors easily buy shares in companies like CATL?
Buying shares in companies like CATL can be challenging for retail investors due to restrictions. However, ETFs with concentrated positions like BATT and CGRO can offer exposure to these companies.

5. What are the prospects for the ETFs’ holdings?
Analysts generally have a positive outlook on the prospects of the ETFs’ holdings. The median analyst rating for BATT indicates a buy, with a price target suggesting a 48.7% upside. Similarly, CGRO is expected to rise by 44.3% over the next 12 months.

Key Terms:
– Electric vehicle (EV): A vehicle that runs on electricity instead of conventional fuels like gasoline or diesel.
– Exchange-traded fund (ETF): A type of investment fund and exchange-traded product, with shares that are traded on a stock exchange.
– Contemporary Amperex Technology (CATL): A Chinese company that specializes in the manufacturing of lithium-ion batteries for electric vehicles.
– Battery-making giant: A term used to describe a company that is a significant player in the production or manufacturing of batteries.

Related Links:
Amplify Lithium & Battery Technology ETF (BATT)
CoreValues Alpha Greater China Growth ETF (CGRO)
BYD