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Investors looking to add a dose of growth to their portfolios may want to consider China ahead of the new year. While the country is working out its current economic issues with the help of its government, it offers investors a window to extract value.

The country's approach to COVID-19 could hamper its recovery.

Spreading protests, COVID outbreak, prompt questions over nation's future.

Investors in China-related assets who had expected a significant easing of COVID curbs were left disappointed this week as the country battles the worst wave of cases since Shanghai's outbreak earlier this year.

Last month's 20th National Congress of the Chinese Communist Party was the country's most significant political event this year. As we expected, President Xi's report to the Congress mainly focused on China's long-term agenda: It continues the policy course set over the past five years, without disclosing much detail on near-term policies.

X-trackers Harvest CSI 300 China A-Shares ETF tracks an index of the 300 largest and most liquid Chinese shares traded on the Shanghai and Shenzhen exchanges. The ETF has almost 50% of its holdings in three sectors: finance, manufacturing and electronic technology.

It appears to us that there is less potential for support for the country's embattled housing sector in the near term. While there had already been restrictions on the export of high-end chips to China, Biden's recent announcement basically expanded the number of components that are restricted.

Our main takeaway from China's 20th Party Congress is the emphasis on security, implying further self-sufficiency—and potential investment opportunity—in the food, energy and technology sectors. At the time of writing, Chinese stocks have regained most of the decline immediately following the Congress, a decline precipitated by unreasonable expectations of positive policy change in areas such as Zero-COVID.

China is taking measures to support its property market, so declines are likely to ease—and even if they don't, we're not looking at a subprime crisis. A proactive Chinese invasion of Taiwan is a low-probability event in our view, at least over the near to medium term.

While high inflation is seen almost everywhere, the Chinese central bank, PBoC is more anxious about meeting the economic growth target. Year to date, it has been keeping policies supportive by cutting some of its key interest rates, including the medium-term lending facility (MLF) rate and loan prime rates (LPR).