Update as of September 2021
I have bought into CXSE again as of September 2021. However i have kept it within 5% weightage of my portfolio.
Update as of August 2021
i have sold off all my CXSE shares due to regulatory risks from the Chinese government. When the regulatory cleansing officially ends. i will relook at this ETF.
In the Portfolio Spotlight Series – i will be going through each holding in my portfolio and the selection criteria for its entry. Stocks are either
1. Great companies with consistent earnings, free cash flow, strong competitive moats. These are first team players
2. Potential growth companies with breakout earnings, growing competitive moats etc… these are hot youth prospects
3. Geographical / sector diversifications.. these are meant for diversification purpose and are reserves
The fourth in the Portfolio Spotlight series is CXSE. CXSE stands for WISDOMTREE CHINA EX-STATE-OWNED ENTERPRISES FUND. This ETF is mainly for diversification purpose mid to long term. It serves to protect against rotational play (e.g. sector rotation) as well as geographical diversification. CXSE currently holds the position of reserve in my team. ETFs are measured using different set of metrics from Equities.
3)Market Cap Size
CXSE’s holdings consists of a whopping 89.31% stocks which are large market cap and 10.19% which are mid cap. There are no small and micro cap stocks. This buffers the ETF from shocks due to unpredictable events such as company bankruptcies or accounting fraud which is more likely to happen to small cap companies.