If you’ve thought about branching out into global financial markets, you might have considered investing in Asia. The region is home to some of the fastest-growing economies in the world, including China, India, and Southeast Asia. Whether you’re drawn to tech giants in China, semiconductor manufacturers in Taiwan, or emerging opportunities in Vietnam, investing in Asian markets could bring exciting growth potential and valuable diversification to your portfolio.

But it’s not always as simple as buying local shares. Investing in Asian markets comes with its own quirks, risks, and steps to follow. A bit of know-how goes a long way.

Why invest in Asian markets?

So why are so many investors looking eastward for opportunities? Here are some key reasons:

• Explosive growth potential – Many Asian economies are expanding at a rapid pace, driven by rising middle-class wealth, increasing consumption, and cutting-edge innovation.
• A chance to diversify – Investing in Asia can help balance your portfolio, as these markets often move differently to Western economies.
• Unique industries and opportunities – Asia leads the world in tech, semiconductors, e-commerce, fintech, and electric vehicles – industries that don’t always have direct counterparts in Australia.
• Tapping into global megatrends – Whether it’s India’s booming digital economy or China’s green energy push, investing in Asia lets you ride some of the biggest global shifts.
• Government policies supporting growth – Many Asian governments offer incentives, infrastructure development, and pro-business policies that fuel economic expansion.
• A growing consumer base – Asia is home to more than half the world’s population, creating significant demand for goods and services across various industries.

Different ways to invest in Asian markets

If you’re keen to add Asian investments to your portfolio, here’s how you can do it – whether you want to be hands-on or take a more passive approach.

Invest in Asia-focused ETFs

Want exposure to Asia without picking individual shares? Exchange-traded funds (ETFs) make it relatively easy to invest in a broad mix of companies across the region.

Why choose an Asian ETF?

• Diversification – A single ETF can hold dozens or even hundreds of shares across multiple countries and sectors.
• Lower risk compared to individual shares – If one company underperforms, your investment isn’t as affected.
• Easier access – Many Asian ETFs are listed on Australian or US exchanges, making them easy to buy through local brokers – like Pearler!

Popular Asian ETFs

If ETFs sound like your style, here are some well-known options:

• iShares Asia 50 ETF (IAA) – Tracks 50 of the largest Asian companies.
• Vanguard FTSE Emerging Markets ETF (VGE) – Covers China, India, Taiwan, and more.
• BetaShares Asia Technology Tigers ETF (ASIA) – Focuses on leading Asian tech firms like Alibaba and Samsung.
• VanEck China Growth Companies ETF (CNEW) – Invests in China’s rapidly growing sectors such as healthcare, technology, and consumer goods.

NOTE: we’re not necessarily recommending you invest in these – only showing you what’s popular in the investing community!

Hedged vs. unhedged ETFs: what’s the difference?

If you’re investing in Asian ETFs, you’ll come across both hedged and unhedged options.

• Hedged ETFs protect against currency fluctuations, making returns more stable in Australian dollars.
• Unhedged ETFs expose you to currency movements, meaning if the AUD weakens, your investment could gain value. But if it strengthens, you might see lower returns.

Learn more in our comprehensive guide to currency hedging .

Buy individual Asian shares

If you have your eye on specific Asian companies, investing in individual shares is the most direct way to gain exposure.

Find a broker that supports Asian markets

Some brokers allow trading on:

• Hong Kong Stock Exchange (HKEX) – Home to Chinese giants like Tencent and Alibaba.
• Shanghai and Shenzhen Stock Exchanges (SSE and SZSE) – The go-to for mainland China stocks (often accessed via Hong Kong’s Stock Connect).
• Tokyo Stock Exchange (TSE) – Ideal for Japanese household names like Sony and Toyota.
• National Stock Exchange of India (NSE) – Where you’ll find top Indian firms like Infosys and Reliance.
• Singapore Exchange (SGX) – A gateway to Southeast Asian investments.

Understand foreign ownership rules

Some Asian markets restrict foreign investors. For example, China’s A-shares (shares of Chinese companies listed on the SSE and SZSE) are typically only available through ETFs, managed funds , or Hong Kong’s Stock Connect program.

Watch out for currency exchange rates

Since you’ll be buying in foreign currencies like Chinese yuan, Japanese yen, or Indian rupees, exchange rate fluctuations can affect your returns. Consider using a brokerage that offers competitive currency exchange rates to minimise costs.

Stay informed on market news and regulations

Asian stock markets can be highly influenced by government policies, trade relationships, and economic developments. Keeping up with the latest news is crucial when investing in individual companies. Political stability and regulatory changes can have a significant impact on market performance.

Learn more about researching what you’re investing in .

Invest in managed funds with an Asian focus

If you prefer professional management, an actively managed fund could be a good option.

Why invest in managed funds?

• Expert oversight – Professional fund managers conduct in-depth research and adjust investments as needed.
• Broad exposure – Most managed funds invest in a mix of shares, bonds, and other assets.
• Potential for outperformance – Unlike ETFs, actively managed funds aim to beat the market rather than just track an index.

Things to keep in mind

• Higher fees – Actively managed funds often come with steeper management costs.
• Less liquidity – Unlike ETFs, which trade like shares, managed funds may have withdrawal restrictions.
• Potential for human error – Should the fund manager(s) fail in their goals, the fund may underperform compared to the market.

We compare managed funds and ETFs here !

Consider listed investment companies (LICs) or exchange-traded mutual funds (ETMFs)

LICs and ETMFs blend elements of ETFs and managed funds, offering additional ways to invest in Asia.

• LICs – Trade on the ASX like shares but hold a portfolio of Asian investments.
• ETMFs (or active ETFs) – Similar to managed funds but trade on exchanges like ETFs, offering more flexibility.

Risks to think about when investing in Asia

While Asian markets offer strong potential, they also come with unique risks:

• Political and regulatory changes – Government policies can have major impacts, especially in China.
• Currency fluctuations – Exchange rates can influence your returns – sometimes for better, sometimes for worse.
• Market volatility – Emerging markets can be more unpredictable than developed economies.
• Liquidity challenges – Some shares and funds may be harder to buy and sell quickly.
• Corporate governance differences – Accounting standards and transparency vary across countries.
• Geopolitical tensions – Conflicts, trade disputes, and diplomatic issues can impact investment returns.

Do your own research and find what works for you

Investing in Asian markets can be a good way to grow and diversify your portfolio, but like any investment, it pays to do your homework. Explore your options, understand the risks, and make sure Asian investments align with your financial goals.

There’s no universal strategy that works for everyone – so whether you choose individual shares, ETFs, or managed funds, pick what suits your investment style. And as always, consider speaking with a licensed financial adviser for tailored guidance.

Happy investing!