 The
VanEck Vectors ChinaAMC China Bond ETF (CBON) is an exchange-traded
fund that tracks the performance of the China bond market.
Specifically, it seeks to track the performance of the ChinaBond China
High Quality Bond Index, which is designed to measure the performance
of fixed-rate, Renminbi ("RMB")-denominated bonds issued in the
People's Republic of China by Chinese credit, governmental and
quasi-governmental (e.g., policy banks) issuers.
CBON was
launched in November 2014 and has since then grown to hold over $3
billion in assets under management. The ETF has an expense ratio of
0.50% and is traded on the NYSE Arca exchange.
As China's bond
market has become more accessible to foreign investors in recent
years, CBON provides investors with exposure to this market while also
providing diversification benefits for a fixed-income portfolio. The
ETF provides exposure to investment-grade bonds issued by Chinese
issuers, with a focus on higher-quality debt.
However, it is
worth noting that investing in China's bond market comes with risks,
including political and economic risks, as well as currency risks,
given the volatility of the RMB exchange rate. Additionally, the
Chinese bond market is relatively less liquid than other major bond
markets, which can impact the ability to buy or sell bonds at desired
prices.
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