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Byline: MURRAY COLEMAN
Exchange traded funds tracking China are on the upswing after a disappointing 2005.
PowerShares Golden Dragon China moved up on IBD's list of outperforming ETFs over the past week, month, three months, six months and 12 months. And so has iShares FTSE/Xinhua China.
"China has really struggled in the past few years," said Peggy McKay, co-manager at JohnsonFamily International Value Fund. "But they've spiked up this year."
At the end of last year, the country loosened its monetary grip a bit in a minor concession to U.S. investors. "But it has raised expectations that China will loosen its control over foreign investments," said McKay. "There's also hope now that they'll be more accepting of private entrepreneurs to help lead reform of their economic systems."
Both could be essential if China wants to move from a manufacturing to a more consumer-oriented marketplace, says McKay.
Breathing Room