Interested in adding Chinese shares to your portfolio? Chinese growth stocks are plentiful and easily accessed from a domestic brokerage account. But the future of these stocks on US exchanges remains uncertain — especially for state-owned enterprises.
Chinese stocks originate from companies that are headquartered in China. Like the US, there are multiple Chinese stock exchanges — including the Hong Kong Stock Exchange, the Shanghai Stock Exchange and the Shenzhen Stock Exchange.
How to buy Chinese stocks from the US
There are a few ways for US investors to add Chinese stocks to their portfolios, including stocks, exchange-traded funds (ETFs) and American Depositary Receipts (ADRs).
With an international brokerage account, you can purchase Chinese stocks directly from Chinese exchanges. Not many US brokers offer international trading, but there are a few that offer access to Asian markets, including Moomoo and Interactive Brokers.
For investors who aren’t ready for an international brokerage account, numerous Chinese companies also list shares on the NYSE and Nasdaq, offering investment opportunities for US investors with domestic brokerage accounts.
ETFs that track Chinese stocks are another way for US investors to diversify into Chinese investments. And Chinese ADRs — certificates that represent shares of foreign stock — can be bought and sold from domestic brokerage accounts.
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China’s economy is on the rise, and its businesses are poised for growth. China is the world’s second-largest economy, second only to the United States. And it enjoys this position thanks to an average economic growth rate of over 6% for nearly 30 years, making it the fastest-growing major economy in the world.
China is also the world’s largest exporter, boasting an export value of approximately $2.5 trillion USD in 2019, according to Statista. In fact, the country’s year-over-year export growth hovered near 17% from 2002 to 2012.
The bottom line? China is a major driver of economic growth and backing Chinese companies presents a potentially lucrative investment opportunity for US investors.
Risks of investing in Chinese stocks
Chinese stocks present unique risks. Many Chinese companies are state-owned, and ongoing tensions between China and the US could result in Chinese stocks being delisted from US exchanges.
In 2017, there were 102 state-owned enterprises (SOEs) in the Fortune Global 500. Of those 102 SOEs, 75 of them were from China. In fact, there are over 150,000 state-owned enterprises in China, according to the China Journal of Accounting Research. Why does this matter? These SOEs have been accused of receiving unfair advantages, like low-cost loans, while yielding less competitive returns than their privately run counterparts.
China has plans to reform its SOEs, but it’s difficult to say what this reform will look like or what impact it could have on privately held Chinese companies.
And speaking of reform, ongoing tensions between China and the United States have led to the Holding Foreign Companies Accountable Act: a bill introduced by the US Congress that requires companies listed on US exchanges to declare any connections with foreign governments. The bill also states that companies listed on US exchanges must submit to audits of the company’s financial performance.
For Chinese companies listed on US exchanges, the bill is problematic and could potentially result in numerous Chinese stocks delisting from US exchanges.
Chinese stocks listed on US exchanges
Over 130 Chinese stocks trade on the New York Stock Exchange and the Nasdaq. You can buy, sell or hold these stocks with a domestic brokerage account the same way you would any US stock.
Select a company to learn more about what they do and how their stock performs, including market capitalization, the price-to-earnings (P/E) ratio, price/earnings-to-growth (PEG) ratio and dividend yield. While this list includes a selection of the most well-known and popular stocks, it doesn't include every stock available.
Alibaba Group Holding Limited, through its subsidiaries, provides online and mobile commerce businesses in the People's Republic of China and internationally. It operates through four segments: Core Commerce, Cloud Computing, Digital Media and Entertainment, and Innovation Initiatives and Others. The company operates Taobao Marketplace, a mobile commerce destination; Tmall, a third-party online and mobile commerce platform for brands and retailers; Alibaba Health Internet platforms for pharmaceutical and healthcare products; Alimama, a monetization platform; 1688.com and Alibaba.com, which are online wholesale marketplaces; AliExpress, a retail marketplace; Lazada, an e-commerce platform; and Tmall Global, an import e-commerce platform. It also operates Lingshoutong, a digital sourcing platform; Cainiao Network logistic services platform; Ele.me, a delivery and local services platform; Koubei, a restaurant and local services guide platform; and Fliggy, an online travel platform. In addition, the company offers pay-for-performance and display marketing services; and Taobao Ad Network and Exchange, a real-time bidding online marketing exchange. Further, it provides elastic computing, database, storage, virtualization network, large-scale computing, security, management and application, big data analytics, and Internet of Things and other services for enterprises; payment and escrow services; and movies, television series, variety shows, animations, and other video content. Additionally, the company operates Youku, an online video platform; Alibaba Pictures and other content platforms that provide online videos, films, live events, news feeds, literature, music, and others; Amap, a mobile digital map, navigation, and real-time traffic information app; DingTalk, a business efficiency app; and Tmall Genie, an AI-powered smart speaker. The company was founded in 1999 and is based in Hangzhou, the People's Republic of China.
Baidu, Inc. provides internet search services primarily in China. Its Baidu Core segment offers products for users, including Baidu App to access search, feed, and other services using mobile devices; Baidu Search to access its search and other services; Baidu Feed that provides users with personalized timeline based on their demographics and interests; Haokan short video app; and Quanmin flash video app for users to create and share short videos. It also offers Baidu Knows, an online community where users can ask questions to other users; Baidu Wiki; Baidu Healthcare Wiki; Baidu Wenku; Baidu Scholar; Baidu Experience; Baidu Post, a social media platform; Baidu Maps, a voice-enabled mobile app that provides travel-related services; Baidu Drive; Baijiahao; and DuerOS, a smart assistant platform. In addition, this segment offers online marketing services, which include pay for performance, an auction-based services that allow customers to bid for priority placement of paid sponsored links and reach users who search for information related to their products or services; other marketing services that include display-based marketing services and other online marketing services based on performance criteria other than cost per click; mobile ecosystem, a portfolio of apps, including Baidu App, Haokan, and Baidu Post; various cloud services and solutions, such as platform as a service, software as a service, and infrastructure as a service; self-driving services, including maps, automated valet parking, autonomous navigation pilot, electric vehicles, and robotaxi fleets, as well as Xiaodu smart devices. Its iQIYI segment provides online entertainment service, including original and licensed content; and other video content, membership; and online advertising services. Baidu, Inc. has a strategic partnership with Zhejiang Geely Holding Group. The company was formerly known as Baidu.com, Inc. Baidu, Inc. was incorporated in 2000 and is headquartered in Beijing, China.
Baozun Inc. provides e-commerce solutions to brand partners in the People's Republic of China. The company's integrated end-to-end brand e-commerce capabilities encompass various aspects of the e-commerce value chain, including IT solutions, online store operations, digital marketing, customer services, warehousing, and fulfillment. It serves brand partners in various categories, including apparel and accessories; appliances; electronics; home and furnishings; food and health products; beauty and cosmetics; fast moving consumer goods, and mother and baby products; and insurance and automobiles. The company was formerly known as Baozun Cayman Inc. and changed its name to Baozun Inc. in March 2015. Baozun Inc. was founded in 2007 and is headquartered in Shanghai, the People's Republic of China.
China Mobile Limited provides mobile telecommunications and related services in Mainland China and Hong Kong. The company offers local calls; domestic and international long distance calls and roaming services; and value-added services, such as caller identity display, call waiting, conference calls, and others. It also provides wireless Internet service, as well as digital applications comprising music, video, reading, gaming, and animation; wireline broadband services; and wireline voice services. In addition, it offers dedicated line and IDC services to corporate customers in a range of industry sectors; and basic corporate communication products comprising corporate VPMN and SMS, and tailor made solutions. Further, the company provides international telecommunications services, which includes IDD, roaming, Internet, MNC, and value added business services. Additionally, it offers telecommunications network planning, design, and consulting services; roaming clearance, IT system operation, and technology support services; value-added platform development and maintenance services; mobile data, and system integration and development services; network construction and maintenance, network planning and optimizing, and training services; electronic communication products design and sale of related products; and non-banking financial services. It also provides mobile cloud research and development services; call center services; e-payment, e-commerce, and Internet finance services; and mobile Internet digital content services, as well as operates a network and business coordination center. The company serves 950 million mobile customers and 187 million wireline broadband customers. The company was formerly known as China Mobile (Hong Kong) Limited and changed its name to China Mobile Limited in May 2006. The company was incorporated in 1997 and is based in Central, Hong Kong. China Mobile Limited is a subsidiary of China Mobile Hong Kong (BVI) Limited.
HUYA Inc., through its subsidiaries, operates game live streaming platforms in the People's Republic of China. Its platforms enable broadcasters and viewers to interact during live streaming. Its live streaming content covers a library of games, including mobile, PC, and console games; and other entertainment genres, such as talent shows, anime, outdoor activities, live chats, online theatre, and other genres. The company operates Nimo TV, a game live streaming platform primarily in Southeast Asia and Latin America. It also provides online advertising and marketing services. In addition, the company provides software development and Internet value added services. As of December 31, 2019, its live streaming content covered approximately 3,800 games. The company was founded in 2014 and is headquartered in Guangzhou, the People's Republic of China. HUYA Inc. is a subsidiary of Tencent Holdings Limited.
JD.com, Inc. operates as an e-commerce company and retail infrastructure service provider in the People's Republic of China. It operates in two segments, JD Retail and New Businesses. The company offers home appliances; mobile handsets and other digital products; desktop, laptop, and other computers, as well as printers and other office equipment; furniture and household goods; apparel; cosmetics, personal care items, and pet products; women's shoes, bags, jewelry, and luxury goods; men's shoes, sports gears, and fitness equipment; automobiles and accessories; maternal and childcare products, toys, and musical instruments; and food, beverage, and fresh produce. It also provides gifts, flowers, and plants; pharmaceutical and healthcare products, including OCT pharmaceutical products, nutritional supplements, healthcare services, and other healthcare equipment; books, e-books, music, movie, and other media products; and virtual goods, such as online travel agency, attraction tickets, and prepaid phone and game cards, as well as industrial products and installation and maintenance services. In addition, the company offers an online marketplace for third-party merchants to sell products to customers; and transaction processing and billing, and other services. Further, it provides online marketing services for suppliers, third-party merchants, and other business partners; supply chain and logistics services for various industries; and consumer financing services to individual customers, as well as online-to-offline solutions. JD.com, Inc. offers its products through its website jd.com and mobile apps, as well as directly to customers. As of December 31, 2020, JD.com, Inc. operated fulfillment centers with a network of approximately 900 warehouses in various counties and districts in China. The company has strategic cooperation agreement with Tencent Holdings Limited. JD.com, Inc. was incorporated in 2006 and is headquartered in Beijing, China.
NetEase, Inc., an Internet technology company, provides online services focusing on content, community, communication, and commerce in the Peoples' Republic of China and internationally. The company operates in three segments: Online Games Services, Youdao, and Innovative Businesses and Others. It develops and operates PC-client and mobile games, as well as offers games licensed from other game developers. The company's products and services include Youdao Dictionary, an online knowledge tool; Youdao Cloudnote, a notetaking tool; smart devices, such as Youdao Smart Pen, Youdao Dictionary Pen, and Youdao Pocket Translator; online courses; interactive learning apps; and enterprise services, such as Youdao Smart Cloud, a cloud-based platform that helps third-party app developers, smart device brands, and manufacturers to access its advanced optical character recognition capability and neural machine translation engine. Its products and services also include NetEase Cloud Music, a music streaming platform; Yanxuan, an e-commerce platform, which sells private label products, including consumer electronics, food, apparel, homeware, kitchenware, and other general merchandise; NetEase Media, an Internet media service; NetEase Mail, an email service; CC Live streaming, a live streaming platform with a focus on game broadcasting; and NetEase Pay, a payment platform. The company was formerly known as NetEase.com, Inc. and changed its name to NetEase, Inc. in March 2012. NetEase, Inc. was founded in 1997 and is headquartered in Hangzhou, the People's Republic of China.
PetroChina Company Limited, together with its subsidiaries, engages in a range of petroleum related products, services, and activities in Mainland China and internationally. It operates through Exploration and Production, Refining and Chemicals, Marketing, and Natural Gas and Pipeline segments. The company's Exploration and Production segment engages in the exploration, development, production, and marketing of crude oil and natural gas. Its Refining and Chemicals segment refines crude oil and petroleum products; and produces and markets primary petrochemical products, derivative petrochemical products, and other chemical products. The company's Marketing segment is involved in marketing of refined products and trading business. Its Natural Gas and Pipeline segment engages in the transmission of natural gas, crude oil, and refined products; and sale of natural gas. As of December 31, 2019, the company had a total length of 87,144 km, including 53,291 km of natural gas pipelines, 20,091 km of crude oil pipelines, and 13,762 km of refined product pipelines. The company is also involved in the exploration, development, and production of oil sands and coalbed methane; trading of crude oil and petrochemical products; storage, chemical engineering, storage facilities, service station, and transportation facilities and related businesses; import and export of goods and technology; and import and export agency business, as well as provision of technology promotion, professional contractor, and main contractor services; and production and sales of basic and derivative chemical, and other chemical products. The company was founded in 1999 and is headquartered in Beijing, the People's Republic of China. PetroChina Company Limited is a subsidiary of China National Petroleum Corporation.
Pinduoduo Inc., through its subsidiaries, operates an e-commerce platform in the People's Republic of China. It operates Pinduoduo, a mobile platform that offers a range of products, including apparel, shoes, bags, mother and childcare products, food and beverage, fresh produce, electronic appliances, furniture and household goods, cosmetics and other personal care items, sports and fitness items, and auto accessories. The company was formerly known as Walnut Street Group Holding Limited and changed its name to Pinduoduo Inc. in July 2018. Pinduoduo Inc. was founded in 2015 and is headquartered in Shanghai, the People's Republic of China.
Tencent Holdings Limited, an investment holding company, provides value-added services (VAS) and Online advertising services in Mainland China and internationally. The company operates through VAS, Online Advertising, FinTech and Business Services, and Others segments. It offers online games and social network services; FinTech and cloud services, and online advertising services, such as media, social, and others advertisement services. The company is also involved in production, investment, and distribution of films and television programs for third parties, as well as copyrights licensing, merchandise sales, and other activities. In addition, it develops software; develops and operates online games; and provides information technology, information system integration, asset management, online literature, and online music entertainment services. Tencent Holdings Limited company was founded in 1998 and is headquartered in Shenzhen, the People's Republic of China.
Vipshop Holdings Limited operates as an online discount retailer for various brands in the People's Republic of China. It operates through four segments, Vip.com, Shan Shan Outlets, Internet Finance, and Others. The company offers women's apparel, such as casual wear, jeans, dresses, outerwear, swimsuits, lingerie, pajamas, and maternity clothes; men's apparel comprising casual and smart-casual T-shirts, polo shirts, jackets, pants, and underwear; women and men casual and formal shoes; and accessories that include belts, jewelry, watches, and glasses for women and men. It also provides handbags, which comprise purses, satchels, duffel bags, and wallets; apparel, gears and accessories, furnishings and decor, toys, and games for boys, girls, infants, and toddlers; sportswear, sports gear, and footwear for tennis, badminton, soccer, swimming, and other sporting activities; and consumer electronic products, including computers, cell phones, digital cameras, and home appliances. In addition, the company offers skin care and cosmetic products, such as cleansers, lotions, face and body creams, face masks, sunscreens, foundations, lipsticks, eye shadows, and other cosmetics; and home furnishings comprising bed and bath products, home decors, dining and tabletop items, and small household appliances. Further, it provides designer apparel, footwear, and accessories; and snacks and health supplements, and occasion-based gifts; and Internet finance services, which comprise consumer and supplier financing, and microcredit. The company offers its branded products through its vip.com and vipshop.com online platforms, as well as through its internet website and cellular phone application. Additionally, it offers warehousing, logistics, product procurement, research and development, technology development, and consulting services. The company was founded in 2008 and is headquartered in Guangzhou, the People's Republic of China.
ZTO Express (Cayman) Inc. provides express delivery and other value-added logistics services in the People's Republic of China. The company offers delivery services for e-commerce and traditional merchants, and other express service users. As of December 31, 2019, it operated a fleet of approximately 6,450 self-owned trucks. The company was founded in 2002 and is headquartered in Shanghai, the People's Republic of China.
There are many well-established Chinese companies that don’t trade on US exchanges. If you hold an international brokerage account, you can purchase shares directly from Chinese markets.
And investors with domestic brokerage accounts can invest by buying American Depositary Receipts (ADRs) in OTC exchanges. Over 150 Chinese companies are listed in American OTC markets. ADRs can be purchased through any domestic brokerage account that offers access to OTC investments.
China Railway Construction (CWYCY)
China Railway Group (CRWOF)
CITIC Ltd (CTPCF)
Industrial and Commercial Bank of China (IDCBY)
Ping An Insurance (PNGAY)
What ETFs track Chinese stocks?
Another option for US investors interested in adding Chinese stocks to their portfolio is by purchasing ETFs that invest in Chinese companies. While this is a less direct investment than purchasing shares, an ETF that tracks Chinese stocks offers broad exposure to a number of securities as opposed to just one.
iShares MSCI China ETF
KraneShares CSI China Internet ETF
Renaissance Capital’s International IPO ETF
SPDR S&P China ETF
Compare trading platforms
Many Chinese stocks can be purchased from a domestic brokerage account. Narrow down your options by comparing features, fees and research tools.
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Disclaimer: The value of any investment can go up or down depending on news, trends and market conditions. We are not investment advisers, so do your own due diligence to understand the risks before you invest.
There are numerous ways to invest in Chinese stocks from a US brokerage account. And for those who prefer to invest in Asian markets directly, brokers like Moomoo and Interactive Brokers offer international brokerage accounts.
Before you open an account, explore available trading platforms by fees and available markets to find the broker that is best positioned to serve your investment goals.
Frequently asked questions
Yes. Some that do include China Mobile, NetEase, PetroChina and Tencent.
The value of your shares may change, but you will retain your share of ownership in the company. Companies forced to delist are typically moved to the OTC market and must change their symbol. But the new Holding Foreign Companies Accountable Act may force Chinese companies to make an offer for any outstanding US shares, take themselves private and relaunch on a new exchange.
Shannon Terrell is a senior writer for Finder who has written over 400 personal finance guides. With a focus on investments and personal finance, she breaks down jargon-laden topics to help others make informed financial decisions. She studied communications and English literature at the University of Toronto.
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