President-elect Donald Trump has been a frequent critic of the Chinese government, especially since the November presidential elections.

He has sharply rebuked China trade practices, which Trump sees as imbalanced in favor of China, and irked the Chinese government with his appointment of lawyer Robert Lighthizer as U.S. Trade Representative (Chinese leaders view Lighthizer as a critic of the country.) Trump has nominated others to high government office, including Wilbur Ross, whom the Chinese government view as hostile to current U.S.-China trade policies.

That scenario hasn't helped China investments, especially key exchange traded funds. For instance, the iShares China Large-Cap (FXI) is down 2% since early December, although the ETF began picking up steam in the last week. Another widely traded ETF, Deutsche X-trackers Harvest CSI300 CHN (ASHR) , has traded down since the election, finishing the year down 15.59%.

No, the Trump factor isn't the only reason these funds are underperforming, but there's no doubt Wall Street firms are keeping a sharp eye on China, and on the stocks and funds that feature Chinese companies. They're also closely monitoring China's already fragile relationship with the incoming Trump administration, especially on trade.

"Trade policies will likely turn more protectionist," said Schroders, in an email to TheStreet. Although Trump has labeled China as a currency manipulator, it is highly unlikely that the Trump administration will implement draconian policies that will significantly deteriorate the Sino-U.S. trade relationship, the firm states.

"However, the Trans Pacific Partnership trade deal is likely to be suspended and select products could face higher import tariffs," Schroders notes. "This would generally be negative for global trade growth and select exporters with large U.S. exposure would face more uncertainties."

Continued infrastructure spending by China and other regional markets could provide some short-term support to commodity prices, Schroders adds: "However, the magnitude of price recovery might be limited given the overall overcapacity situation facing the industry."

Overall, though, the investment firm is fairly bullish on China - to a point. "Meanwhile, China's economy has shown signs of stabilization in 2016 on the back of accommodative monetary policy and more proactive fiscal policies," the firm states. "A slew of economic data, such as GDP, consumer price inflation and producer price index have pointed to a more stable outlook for the world's second-largest economy. On the negative side, the tightening of China's property market, yuan depreciation amid capital outflows, higher interest rates, along with external political uncertainties, could potentially pose headwinds to the market."

Geoffrey Pazzanese, senior portfolio manager at Federated Investors, says "it remains to be seen" how impactful new U.S. policies will be regarding China. "Trump will not be the President for a few more weeks, yet it seems he is still campaigning and has not yet transitioned to governing," he notes.

Pazzanese says that, after an uncertain start at the beginning of the year, China's economy has stabilized and appears to be growing modestly as domestic consumption, reflected by the new economy companies and real estate, has remained resilient.

"The Chinese economy, according to government figures, continues to grow within their targeted range of 6% to 7%, a range disputed by many investors who believe the actual level growth to be between 4% to 5%," he states. "Real GDP growth in China has remained in positive range despite pressure from old economy companies, such as cement and steel, which are effectively in a long-term secular decline as the country continues its economic transformation from one dependent on high fixed asset investment to one reliant on consumption and services."

China fiscal and monetary policies have been more effective, Pazzanese states. "Concerns about the high level of corporate debt will continue to overhang the market," he says. "However, the Chinese government has demonstrated that rising non-performing loan issues will be managed in an orderly fashion, and policymakers have announced additional measures to reduce speculation and curb the potential for a real estate bubble, particularly in 'tier one' cities like Shanghai. Consequently, economic and social stability should be maintained and the world's second-largest economy remains the engine of growth for the rest of the Asian region."

Chinese stocks and funds do have a place in a diversified international equity portfolio, Pazzanese adds. "International stocks are generally a portion of an investor's overall allocation, where appropriateness for investment varies client by client," he says. "That said, I don't think an investor should have an entire portfolio or own a fund which is entirely Chinese stocks. Rather, allocations to China should be dynamic."

Overall, the outlook as 2017 opens for business seems bullish on China, and that should boost Chinese stocks and ETFs, Trump or no Trump.

"Looking ahead, we expect growth to be stable and resilient, with consumption being the major contributor," states Invesco Canada, in a recent research note. "We expect retail sales in China to maintain an annual growth rate of about 10%, supported by resilient wage growth. Disposable income per capita for the urban population grew in the range of 8% to 13% year-on-year over the past year, and we expect this trend to continue."

"Also, we believe the consumption sector should continue to benefit from the rising demand in services," the firm adds. "Ranging from hospitality, retail, financial services, health care, education and information technology services, the services sector should be a key source of growth looking ahead, in our view."

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