China is now the world's second-largest economy, surpassing
Japan. But while China sets its sights on the number one position,
it might want to look behind itself, too: India is formidable
competition. With one exchange traded fund (
), you can play both.
China's ascendancy to the top position isn't a foregone
conclusion. Just two decades ago, Japan was seen as the main rival
to the United States. But
is on track to outpace China's growth in less than three years.
Economist explains that
in the short-term their other foreign relationships may matter
more, even in Asia: there may, for instance, be a greater risk of
conflict between rising China and an aging but still powerful
Japan. Western powers still wield considerable influence, too. [
How China And India ETFs Grapple With Ghosts.
China and India may have the largest hurdle of all to come to a
head: a serious effort to solve their own disagreements is a good
place to start. [
India ETFs Change Course.
Economist also points out that
there are opportunities for greater cooperation between the two
economies, given their economic strengths (manufacturing in China
and services in India). Two-way trade is thriving - it will be more
than $60 billion this year, up from $270 million just 20 years ago.
China's Shift to Domestic Consumption.
The main points to watch during the growth is China's political
reform against the economic change as well as India's economic
price for its democracy. China has the means and the money to pull
through and help the rest of the world, however, India may not have
any answers to the growing economic problem plaguing the globe.
The race is anyone's to win right now. If you can't decide on
one economy, why not play both and let them sort out the rest?
First Trust ISE Chindia (NYSEArca: FNI):
FNI tracks an index of 50 ADRs of companies domiciled in China or
India. Information technology is 29.4% of the fund; financials
are 22.7%. Other sectors include telecommunications, energy and
industrials. The fund has an expense ratio of 0.60%.
Tisha Guerrero contributed to this article.