KALL ETF

China stocks are on the rise again, with many major global banks now optimistic about this previously struggling asset class. The KraneShares MSCI All China Index ETF (KALL) is one of the exchange traded funds that is profiting from the increased interest in Chinese equities.

Emerging markets equities and the related ETFs have long been responsive to Federal Reserve decisions on U.S. interest rates. This indicates that if the central pares rates this year, some upside could be in store for those long-lagging assets.

Following three consecutive years of losses, China stocks were believed to present investors with upside potential for 2024. To start the year, that thesis is being challenged.

Following three straight years of declines, China stocks are inexpensive; that much is known. But downtrodden shares in the the country's economy may now be cheap enough to entice professional investors.

To close 2023, there's been a flood of bullish calls on China stocks for 2024. That isn't surprising when considering the asset class is headed toward a third consecutive losing year.

In the Chinese zodiac, 2024 is the year of the dragon. For stocks in the world's second-largest economy, next year could be the year of the bull, as some major global banks are forecasting a resurgence by China equities.

Increased growth prospects for China's economy courtesy of the International Monetary Fund should set the stage for more investor interest in ETFs focusing on the country. China's growth has been stunted by ongoing real estate development issues.

Krane Funds Advisors (KraneShares) has launched the actively managed KraneShares Dynamic Emerging Markets Strategy ETF (NYSE Arca: KEM). KEM provides exposure to broad emerging market equities while dynamically adjusting its weight to China based on real-time signals.

While many advisors and investors remain on the sidelines, major hedge funds increased China holdings in Q1. It's a strong signal for the potential in China exposures in a year of global economic challenge, and advisors should take notice.