In 2025, how to invest in Chinese funds correctly? Here are 10 funds to follow closely.

Why Chinese Equity Funds Are Attractive in 2025

China’s economy, despite facing some challenges recently, remains a key driver in the global economic landscape, ranking second after the United States. With a large market size and long-term growth potential, Chinese equity funds have become a valuable option for investors seeking opportunities in the Asian market, especially in the finance, technology, and e-commerce sectors that continue to expand steadily.

Key Differences Between Fund Types You Should Know

Index Tracking Funds (Passive Approach)

This type of fund is designed to closely follow the performance of Chinese stock indices, with lower fees. It is suitable for beginner investors or those seeking stability, accepting consistent but lower returns through passive management.

Active Securities Selection Funds (Active Management)

An investment strategy where fund managers play a crucial role in selecting individual stocks. The goal is to generate returns exceeding the benchmark, but it involves higher risks and higher fees. Investors should review the fund management team’s history and experience before making decisions.

Performance Summary of 10 Chinese Funds Over 3 Years

Analysis of 10 Funds to Watch

SCBCEE: The Main Choice for Long-Term Investors

The Thai SCB Chinese Equity Fund, available via electronic channels, shows a cumulative return of 11.37% since the start of the year, with an average three-year return of 6.88% per year. Its long-term performance has weakened when looking back five years, at (0.56% per year), reflecting the ups and downs of the Chinese market. It does not distribute dividends, focusing instead on capital accumulation for long-term investment.

SCBCEP: For Those Accepting Moderate Risk

Cumulative return since the start of the year is 10.38%, with a three-year annual return of 5.94%. This fund is designed for wealth accumulation, aligning with the challenges faced over the past five years, at (-0.33% per year). It does not pay dividends and is suitable for retirement planning for those who can handle the volatility of the new markets.

SCBCE (SSF): Special Savings Fund

A tax-advantaged option, with a return of 10.92% since the start of the year and a three-year annual return of 5.81%. Data for five years is unavailable due to shorter investment periods. It carries higher risk, does not distribute dividends, and is suitable for disciplined investors who benefit from tax advantages.

SCBCE: The Basic Version of Thai SCB

Since the start of the year, it has a return of 10.91%. Its risk structure is similar to SCBCEE, but long-term performance has declined to -0.45% per year. It does not pay dividends and is designed for investors confident in China’s market recovery and willing to accept volatility.

SCBCEHE: For More Experienced Investors

Since the start of the year, it has a return of 14.63%, the most volatile, but with weaker long-term results (3-year 4.30%, 5-year -2.09%). It is a hedge currency fund with no dividend distribution, high risk, suitable for experienced investors seeking short-term gains.

TISCOCH: TISCO Enters the Chinese Market

Since the start of the year, it has a return of 14.18%, but long-term returns are cautious (3-year 3.65%, 5-year -3.26%). No dividends, high risk, suitable for long-term investors who believe in China’s recovery but should be cautious of long-term downward trends.

TCHRMF: TMB Retirement Fund

Cumulative return of 13.89% since the start of the year, with a three-year return of 3.57% per year, but a negative five-year return (-3.16%). Designed for retirement, no dividends, high risk, suitable for those seeking tax savings and long-term economic growth but willing to accept medium-term volatility.

KF-HSHARE-INDX: Index Tracking Investment

Since the start of the year, it has a return of 14.21%, with a three-year return of 3.32% per year, and a five-year return of -2.91%. An index-based structure, no dividends, high risk. For those seeking a passive approach in the Chinese market, suitable for diversification.

SCBCEHP: RMF with Currency Hedge

Profit of 14.18% since the start of the year, with a three-year return of 3.30% per year, and a five-year return of -3.03%. A Thai SCB RMF with hedge, no dividends, high risk. Designed for long-term investors who accept risk and seek growth over income.

SCBCEH: Final Currency Hedge Option

Since the start of the year, it has a return of 14.16%, but long-term returns are negative (3-year 3.26%, 5-year -3.07%). No dividends, high risk, showing short-term recovery but should be approached with caution. Suitable for investors emphasizing high risk in Asia diversification.

Conclusions and Recommendations

The Chinese equity funds presented in this analysis mostly employ a passive investment strategy that closely tracks the market, which is a primary risk mitigation method for general investors.

Before investing in any foreign mutual funds, investors should thoroughly review the prospectus. Investing in the Chinese market involves significant risks, and past performance does not guarantee future results. Investors should consider their personal circumstances, risk tolerance, and investment horizon before making decisions.