China and Tesla: Here's what's hot in the ETF space right now

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China ETFs are on the move—here's what to watch

China and Tesla.

Those two themes have attracted meaningful inflows to the exchange-traded fund space in recent weeks, buoyed by tentative optimism around China's ability to stem the spread of the coronavirus and Tesla's rip-roaring run year to date.

Industry leaders from both sides of the bullishness — Armando Senra, head of iShares Americas at BlackRock, and Jay Jacobs, head of research and strategy at Global X ETFs — saw more room for growth in their respective funds.

Senra, whose firm runs the world's largest China ETF by assets — iShares' MSCI China ETF (MCHI) — said MCHI's recent success has been fueled by investors "buying the dip," or capitalizing on what they see as the nadir of the Chinese market's coronavirus-related weakness. The fund has climbed nearly 8% so far this month.

"Interestingly, people [are] buying the dip. You're beginning to see flow from emerging markets into China," Senra said Monday on CNBC's "ETF Edge."

It's not just MCHI, either, the iShares chief said. The iShares MSCI China A ETF (CNYA), which gives U.S. investors access to China's domestic A-share market, has also climbed this month, with a 9% gain.

Largely, the action is "ETFs showing you how they provide liquidity and price discovery during times of volatility," Senra said, adding that "we continue to ... have a pro-risk stance for this year" for emerging markets as economic growth abroad recovers.

On Tesla's side of the bullish bet, Global X's Jacobs was offering a twist on trading the wildly swinging electric-auto stock.

"Tesla's the poster child of a broader trend, which is the growth of the electric vehicle space," he said in the same "ETF Edge" interview. "Right now, electric vehicles make up less than 3% of total car sales around the world. It's an 80 million annual market in car sales. People don't know about the miners, they don't know about the battery producers, but they want exposure to the broader EV space."

Enter the Global X Lithium & Battery Tech ETF (LIT), which has a nearly 20% position in chemical giant Albemarle, a roughly 13% position in Chilean chemical producer Sociedad Química y Minera and an 11% stake in Tesla. The ETF, which also counts Tesla partner Panasonic among its top holdings, has climbed more than 9% month to date.

"There's not a lot of companies in this space," Jacobs said. "It's very concentrated in the lithium miner space — about four companies make up 80% of output — and it's similar in the battery space. So, there's a handful of companies that are really a critical part of that electric vehicle battery pipeline."

MCHI, CNYA and LIT were all up nearly 2% in early Tuesday trading. Tesla was up less than 1%.

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