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Given the interconnectedness of the world we live in, investors needn’t limit themselves to investments within their own borders. To truly have a diversified portfolio investors need to look overseas. Unquestionably, there is plenty of opportunity in adding positions in developed markets such as Australia, Canada, Switzerland, Sweden, Germany and Netherlands, but international investing doesn’t stop there. It’s equally important for investors to focus on emerging market economies, such as in Peru. Mexico and China.

Expert Opinion

Given the scale, population and economic diversity of China it’s a natural choice for investors looking to invest abroad. When looking to invest in any sector or region, the best place to start is to research the opinion of experts in your specific area of interest. When it comes to emerging markets, there are few individuals that know the topic better than Mark Mobius of Franklin Templeton Investments. (For more, see: What is an Emerging Market Economy? )

According to a recent Bloomberg article , Mobius says it’s not too late to invest in Chinese stocks. At the time the article was posted, Mr. Mobius was looking for an additional 20% rise in the Hang Seng China Enterprise Index. The article also mentioned that the Templeton Asian Growth Fund has outperformed 94% of peers and that it favors state-owned banks and energy companies because of cheap valuations and the government’s plans to open up state-dominated industries. (For more, see: Great Investors Not Named Buffett .)

Aside from mutual funds offered by companies such as Franklin Templeton, one of the most common products available for U.S. investors looking to gain exposure to China is the iShares FTSE China 25 Index Fund (FXI ). This exchange-traded fund has total net assets of 5.7 billion and trades with a reasonable gross expense ratio of 0.73%.

Taking a look at the five-year weekly chart below, you can see that the fund has been trading within a period of consolidation. The price has generally traded between $30 and $42.50. However, the recent price action is suggesting that bulls have started to take notice and that upward momentum is starting to build. The bullish crossover between the 50-week moving average and the 200-week moving average is known as the golden crossover and it’s suggesting that the next leg of the long-term uptrend is about to begin.

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FXI’s Top Holdings

Taking a look at the top ten holdings of the FXI ETF, you can see that the positions have particularly heavy concentration in financials and oil and gas, which Mark Mobius tends to be most interested in: