Uncommon Yields: How China is a Rare Bright Spot in a World Deprived of Yield (KraneShares)

Yields have declined across developed markets worldwide. Today, it is impossible for fixed-income investors to achieve the same returns they did fifteen years ago without rethinking their approach. This reality has forced many conservative investors into riskier and riskier asset classes in a race to find new sources of yield. KraneShares thinks China may be a more attractive alternative.

Key Takeaways:

  1. China’s bond market may be poised to deliver high yields in a yield-deprived global environment.
  2. The offshore and onshore bond markets are now equally accessible to international investors.
  3. China’s currency has been trending towards stability, making RMB-denominated cash flows increasingly attractive.
  4. Chinese bonds are being rapidly included into dominant global bond benchmarks. With yield and return potential higher than in many other fixed income markets, investors could underperform these benchmarks without a meaningful allocation to China’s bond market. READ MORE

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