The Shanghai Composite index slumped to a 15-month low today after data pointed to slowing growth and inflation concerns.
The manager of the £199m M&G Global Emerging Markets fund has taken an underweight stance to China in the view valuations are more attractive in other Asian countries.
Royal London's David Varley says growth in Japan will be largely driven by external factors, notably China's economy, for some time to come.
Investors in China must look to companies not reliant on cheap labour for their competitive advantage, as this will soon fade, says M&G's Matthew Vaight.
The amount raised by companies from equity capital markets during the first half of the year was the lowest in five years.