Down 30% in 2022, what’s next for the BetaShares Asia Technology Tigers ETF?

As most of us would be aware, it hasn’t been a great year thus far for ASX shares. As it stands today, the S&P/ASX 200 Index (ASX: XJO) remains down by a nasty 8.62% year to date. But for the BetaShares Asia Technology Tigers ETF (ASX: ASIA), that loss is looking desirable.

This exchange-traded fund (ETF) has taken a battering this year. On today’s pricing, units of the BetaSahres Asia Technology Tigers ETF are down a painful 28.46% over 2022 thus far.

The Asia Tigers ETF is a tech-focused fund that holds around 50 companies. These hail from across Asia (excluding Japan), but the lion’s share (55.5%) are domiciled in China. Other countries like Taiwan, South Korea, India and Hong Kong make up the rest.

This ETF focuses on technology companies. Its top holdings include names like Alibaba, Taiwan Semiconductor Manufacturing Co, Tencent Holdings and Samsung.

With China taking such a large chunk of this ETF, it’s clear that many of the woes that the fund has faced in 2022 hail from this market. To illustrate, the Alibaba share price is down almost 35% year to date, while Tencent shares have lost almost 35%.

So what’s next for the Asia Tigers ETF?

For some insights into that question let’s turn to an expert. Anthony Strom of Fidelity International is an expert on Asian markets. He recently sat down for an interview with Livewire.

So Strom blames the woes that many Asian markets are currently facing on a couple of factors:

What stage are we at now with the Asian Century? Immediate words that come to mind are things like growing pains.What we’re seeing is a lot of growth being developed in that region through debt accumulation, which as we saw with the Asian crisis, is not a sustainable path forward. We’re seeing things like the corruption crackdown in China. You can take that as another positive, but again, it has the effect of slowing down development as markets must adjust.

That’s a higher-level summary of the current stage of the Asian century. I think it’s a stage of transition and slight growing pains.

Strom also notes that “the zero COVID policy has really slammed the breaks on growth within China”.

So the companies that the Asia Tigers ETF holds are certainly facing some challenges. But Strom is still confident that investing in Asian markets still “holds a lot of promise”. He names Malaysia, India and Indonesia as growth markets to watch.

How these will affect the BetaShares Asia Technology Tigers ETF is unclear. But investors might gain some confidence knowing that this Asian investing expert is still predicting a bright future.

The post Down 30% in 2022, what’s next for the BetaShares Asia Technology Tigers ETF? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Taiwan Semiconductor Manufacturing. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Taiwan Semiconductor Manufacturing and Tencent Holdings. The Motley Fool Australia has recommended BetaShares Asia Technology Tigers ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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