With an impressive 29.0% gain, the Fidelity China Fund took the crown as the top performing fund for the first half of the year. It handily outpaced its peers, and kept up to the MSCI All China, Hong Kong, and Taiwan Index in Canadian dollar terms.
However, the tide seems to have turned in China, and the index is off more than 18% from its June 12th peak. Much of this year’s earlier gains were attributed to margin fueled buying, and this recent selloff will help bring prices back to normal. As this happens, expect continued volatility, as Chinese authorities have stepped in to shut down some short selling accounts and are taking other steps to bolster the falling markets.
Unless you have an extremely high appetite for risk, I would avoid China at the moment, as I believe the risks are just too high at the moment. But if you are looking to invest in China, this is not a bad fund to consider.