Foreign investors have already pulled back from China

Investment in Chinese assets fell significantly this year as a combination of the trade war and increasingly attractive opportunities elsewhere spread money across a variety of locations in the emerging world.

The big picture: While the economies of many emerging countries are feeling the pressure from China's slowdown and reduced global trade, foreign investment has picked up notably this year from 2018.

Why it matters: The White House has reportedly floated the idea of cutting off U.S. investors' access to some Chinese investments, but data shows President Trump's trade war has already significantly reduced the level of Chinese securities purchased by foreigners.

What they're saying: The flow of funds out of China has largely gone to other emerging countries, particularly Saudi Arabia.

• Having just this year joined emerging market indexes, Saudi Arabia has attracted $21 billion in foreign portfolio equity inflows, "becoming the top equity investment destination among emerging markets," Jonathan Fortun, an economist at the Institute of International Finance, told Axios.
• Nigeria and Ukraine also have seen significant inflows as investors pull back on Chinese assets, Fortun said.

Yes, but: Chinese investments bounced back in September when emerging market stocks and bonds registered nearly $38 billion of inflows, according to IIF data released Tuesday.

• That was one of the strongest months this year, and Chinese stocks drew $9.2 billion, a substantial increase over August's $1.6 billion inflows.

Go deeper: U.S. ban on Chinese investments would take trade war to a new level