LONDON, Oct 3 Reuters Geopolitical tensions and a weakening economy are driving hedge funds to consider alternatives to investing in China.

Turmoil in China39;s property sector has rattled world markets and hurt the outlook for the world39;s No. 2 economy. Many U.S.based hedge fund investors have cut their exposure to Chinese companies, according to Goldman Sachs.

Four hedge funds shared four ideas for alternatives to investing in Chinese assets. These do not represent recommendations or trading positions, which cannot be revealed for regulatory reasons.

1 DISCOVERY CAPITAL MANAGEMENT

Discretionary U.S.based global macro hedge fund

Size 1.5 billion

Founded in 1999

Key trade long Latin America, underweight, short China and Taiwan

Discovery founder and longtime investor in emerging markets, Robert Citrone, sees opportunity in Latin America, particularly in Argentina and Ecuador, where the results of presidential elections could drive asset prices up. He is also focused on Mexico.

Other emerging market countries in the world don39;t have short term catalysts as Argentina, Ecuador and Mexico may have, he said.

He suggested telecommunications and cement companies in Mexico, besides its currency and rates. In Argentina, he favours energy companies, while in Ecuador he likes sovereign dollar debt.

Citrone also suggested short positions in China39;s yuan , property developers and banks, and said monetary and fiscal policy would need to be eased dramatically to…