HOW to add Chinese exposure to your investment portfolio

I've briefly outlined five easy ways to invest in China below. My advice would be to give careful consideration to each strategy as a part of your overall emerging market investment objectives.

1.) Exchange-traded funds: We've been telling you a lot about exchange-traded funds (ETFs). That's because these investments can give you a diversified stake in a particular sector, index or country in one shot.

There are several ETFs that can give you direct exposure to China and its mega-growth neighbors, but the iShares FTSE/Xinhua China 25 Index (FXI) is the most popular Chinese ETF.

2.) Mutual Funds: ETFs are great, but don't forget about traditional, actively-managed mutual funds, either. Some of my favorites are U.S. Global's China Region Opportunity (USCOX), Fidelity's China Region (FHKCX), and T. Rowe Price's New Asia (PRASX).

3.) Chinese companies trading on U.S. exchanges: As I pointed out earlier, more than 100 Chinese companies are listed on U.S. exchanges. What's more, they are some of the largest and most profitable companies in all of China.

4.) Chinese companies trading on foreign exchanges: A lot of really attractive Chinese companies are listed on the Hong Kong Stock Exchange, and others can be found on the exchanges in Singapore and London.

If you've never bought a stock on a foreign stock exchange, you'll be surprised at how easy it is. All you need is a broker with an international trading desk and the ticker symbol of the stock!

5.) U.S. companies doing big business in China: U.S. companies have been doing business in overseas markets for a long time. But these days, some American firms are getting the bulk of their revenues from outside the U.S.

For example, both Yum Brands — which runs Pizza Hut, Taco Bell, and KFC — and casino company Las Vegas Sands both garner more than half of their sales from outside the U.S. In other words, even carefully selected U.S. companies can give you a very significant stake in China!

Which of these investment strategies is right for you? The answer depends on a lot of things: How aggressive you are, whether you're more of a do-it-yourselfer, and how focused you want to get.

But the most important thing is that you take a hard look at adding some Chinese investments to your portfolio. That's where I continue to see the biggest profit potential.