Frustrated by losses, Chinese investors sought refuge in neighboring countries as stocks plummeted.
Experts anticipate that the trend of investor migration will persist into 2024.
In 2023, Chinese stocks experienced a challenging year due to economic difficulties, resulting in a significant downturn in stock prices and discouraging local investors. Consequently, Chinese investors redirected their capital towards Japan’s appealing ETF fund group.
Trading activity in the China AMC Nomura Nikkei 225 ETF reached a historic high of 373 million yuan (equivalent to 52 million USD) on January 10, a staggering tenfold increase compared to the 2023 average. The AMC Nomura ETF also witnessed a surge in activity, registering a 6.3% jump since January 5, surpassing the Nikkei 225’s 3.2% increase.
Contrastingly, Japan’s Topix index experienced a remarkable 25% surge in 2023, reaching a 34-year high.
On the other hand, China’s CSI 300 index faced an 11% decline in 2023. Challenges in the real estate sector, sluggish consumer demand, and trade tensions with the US have significantly impacted the country’s economy. The benchmark index is currently trading at its lowest level in five years.
Persistent economic challenges have negatively affected investor sentiment over the past year. Pessimism about the swift recovery of the Chinese economy is widespread, leading to a substantial retreat of foreign investors who withdrew 90% of the capital invested in the Chinese market in 2023.
Given the need for more time for China’s economy to recover, experts predict that the wave of investor migration will continue into 2024.