Marc Faber Bullish On Real Estate In China And Hong Kong

August 20, 2014

Faber sees recent pullbacks as an opportunity to add exposure to Asian real estate.

TAO_YTD_TR

Chart courtesy of StockCharts.com

Marc Faber recently sat down with ETF.com's Alpha Think Tank to discuss his views on everything from U.S. Treasurys to Chinese real estate. One of several views that Faber expressed was his bullishness on the Chinese property market.

However, instead of investing directly in mainland real estate developers, Faber prefers to express this view through the highly correlated Hong Kong market, where he notes that property stocks "all sell at discounts around 40-45 percent to net asset value."

The best ETF to implement Faber's view is the Guggenheim China Real Estate ETF (TAO | D-29), which tracks a market-cap-weighted index of Chinese and Hong Kong real estate companies and REITs. More than 80 percent of the fund is allocated to Hong Kong, with the majority of the remainder invested in Chinese companies. TAO is up roughly 10 percent so far this year.

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