Greater China - 2026 Outlook
Director, Chief Investment Officer, Portfolio Manager
Portfolio Manager, Asian & Emerging Markets
This is a marketing communication. Please refer to the prospectus, supplement and KID/KIID for the Funds before making any final investment decisions. The value of this investment can fall as well as rise as a result of market and currency fluctuations. You may not get back the amount you invested.
Past performance does not predict future returns.
Chinese markets had a good start to 2025, driven by the unexpected release of Deepseek, which led to a sharp rally in offshore markets. However, in April, Donald Trump's “Liberation Day” led to a series of tariffs from both the US and China, eventually ending in a temporary trade truce in May.
An AI rally drove Chinese markets higher every month in the third quarter. However, in the fourth quarter, Chinese markets weakened, with the largest drag being AI-related stocks that had driven markets in the third quarter. We highlight the narrow breadth of market strength in China and the associated concentration risk. Of the 31.2% rise in the MSCI China Index, 6.7 percentage points (pp) were driven by Tencent and a further 6.2 pp from Alibaba. These are by far the two largest stocks in the index, with weights of 17% and 11%, respectively.
Source: Factset, Guinness calculations. Data from 31/12/24 to 31/12/25
Looking ahead, we believe that China is reaching an important transition point. Towards the end of 2026, we expect the new pillar industries to become sufficiently large to offset the drag from real estate, supporting a meaningful and long-lasting improvement in economic growth. But until then, the economy is likely to need further support over the next 12 months. Therefore, it was encouraging to see the Central Economic Work Conference (CEWC), which is where China’s leadership sets economic policy for next year, call for more proactive policies.
From an investment perspective, our views remain rooted in company fundamentals rather than macro forecasts. The Fund is not an investment in the broader Chinese economy, nor is it reliant on stimulus to drive returns. It is a concentrated, bottom-up-driven portfolio of our 30 highest-conviction ideas in China which have durable competitive advantages and long-term growth potential. In an environment characterised by uneven growth and policy uncertainty, we believe the Fund’s combination of quality, growth and valuation discipline positions it well to compound returns over time
In this commentary, we analyse how China's domestic economy has fared over 2025, the drivers of Fund performance, portfolio changes over the year, as well as our outlook for 2026.
The value of this investment can fall as well as rise as a result of market and currency fluctuations. You may not get back the amount you invested.
The information provided on this page is for informational purposes only. While we believe it to be reliable, it may be inaccurate or incomplete. Any opinions stated are honestly held at the time of publication, but are not guaranteed and should therefore not be relied upon. This content should not be relied upon as financial advice or a recommendation to invest in the Funds or to buy or sell individual securities, nor does it constitute an offer for sale. Full details on Ongoing Charges Figures (OCFs) for all share classes are available here.
The Guinness Greater China Fund is designed to provide investors with exposure to economic expansion and demographic trends in China and Taiwan. The Fund is managed for capital growth and invests in profitable companies generating persistently high return on capital over the business cycle. The Fund is actively managed with the MSCI Golden Dragon used as a comparator benchmark only.
For the avoidance of doubt, if you decide to invest, you will be buying units/shares in the Fund and will not be investing directly in the underlying assets of the Fund
Documentation
The documentation needed to make an investment, including the Prospectus, the Key Information Document (KID) / Key Investor Information Document (KIID) and the Application Form, is available from the website www.guinnessgi.com , or free of charge from:
the Manager: Waystone Management Company (IE) Limited 2nd Floor 35 Shelbourne Road, Ballsbridge, Dublin DO4 A4E0; or, the Promoter and Investment Manager: Guinness Asset Management Ltd, 18 Smith Square, London SW1P 3HZ.
Waystone IE is a company incorporated under the laws of Ireland having its registered office at 35 Shelbourne Rd, Ballsbridge, Dublin, D04 A4E0 Ireland, which is authorised by the Central Bank of Ireland, has appointed Guinness Asset Management Ltd as Investment Manager to this fund, and as Manager has the right to terminate the arrangements made for the marketing of funds in accordance with the UCITS Directive.
Investor Rights
A summary of investor rights in English, including collective redress mechanisms, is available here: https://www.waystone.com/waystone-policies/
Residency
In countries where the Funds are not registered for sale or in any other circumstances where their distribution is not authorised or is unlawful, the Funds should not be distributed to resident Retail Clients. NOTE: THIS INVESTMENT IS NOT FOR SALE TO U.S. PERSONS.
Structure & Regulation
The Fund is a sub-fund of Guinness Asset Management Funds PLC, an open-ended umbrella-type investment company, incorporated in Ireland and authorised and supervised by the Central Bank of Ireland, which operates under EU legislation. The Funds have been approved by the Financial Conduct Authority for sale in the UK. If you are in any doubt about the suitability of investing in these Funds, please consult your investment or other professional adviser.
Switzerland
This is an advertising document. The prospectus and KID for Switzerland, the articles of association, and the annual and semi-annual reports can be obtained free of charge from the representative in Switzerland: Reyl & Cie SA, Ru du Rhône 4, 1204 Geneva. The paying agent is Banque Cantonale de Genève, 17 Quai de l'Ile, 1204 Geneva.
Singapore
The Fund is not authorised or recognised by the Monetary Authority of Singapore (“MAS”) and shares are not allowed to be offered to the retail public. The Fund is registered with the MAS as a Restricted Foreign Scheme. Shares of the Fund may only be offered to institutional and accredited investors (as defined in the Securities and Futures Act (Cap.289)) (‘SFA’) and this material is limited to the investors in those categories.