5 ETF Ways To Bet On China's New Tariff Threats

Trade war fears have once again flared up with China threatening to impose tariff on $60 billion worth of American goods if the United States places more tariffs on Chinese imports. The list includes new 5,207 products including aircraft, soya bean oil, smoked beef, coffee and flour imported from the United States, with charges ranging from 5-25%.

The move came following the news that Trump is mulling over raising tariffs from a proposed 10% to 25% on $200 billion of Chinese goods. Both countries have already implemented tariffs on $34 billion worth of each other’s goods in July. Each side is also expected to implement tariffs on an additional $16 billion in goods.

This time, China is focusing on roughly two-fifths of its purchases from the United States after Trump threatened two-fifths of China’s much larger exports to the United States. With this, China has now either imposed or proposed tariffs on $110 billion in U.S. goods, representing the vast majority of China's annual imports of American products. Last year, China has imported about $130 billion in goods from the United States.

An escalation in trade clash between the United States and China led to risk-off trade, leading to higher demand for safe haven avenues or lower risk securities. Below we have highlighted six such zones and their popular ETFs where investors could stash their money amid escalating trade war fears.

Gold - SPDR Gold Trust ETF (GLD  - Free Report)

Increase in tariff threats has raised the appeal for the bullion as a store of value and hedge against market turmoil. The ultra-popular product tracking this bullion like GLD could be an interesting pick in the current market turbulence. The fund tracks the price of gold bullion measured in U.S. dollars and kept in London under the custody of HSBC Bank USA. It is an ultra-popular gold ETF with AUM of $31.1 billion and heavy volume of nearly 6.9 million shares a day. It charges 40 bps in fees per year from investors and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.

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