United Kingdom-registered funds investing in China delivered the best returns to British investors in the first half of 2017, according to data released on Thursday by investment research company Morningstar.

The data showed that funds invested in China returned nearly 19 percent on average to investors over the six months ending on June 30. The China returns were followed by funds investing in the Asia-Pacific region, which returned 15 percent, and funds buying small capitalization companies in Europe and the UK, which also returned 15 percent.

Analysts said strong Chinese economic growth relative to stock market values is a key reason for the good returns seen by UK funds.

Danny Dolan, managing director of China Post Global, the international arm of the Chinese fund China Post, said, "The Chinese equity market trades at a discount based on the country's GDP growth, and is quite inexpensive relative to the US and several other developed and emerging markets."

Meanwhile, significant capital account liberalization measures by the Chinese government over the past year, which allowed foreign investors greater access to the Chinese onshore stock and bond markets, also made it possible for many more overseas funds to buy into China.

These measures include stock and bond market connects, which allow overseas investors to buy Chinese shares via Hong Kong, and relatively relaxed rules for foreign investors' access to China's interbank bond market.

"Steady work done by China to ease access to its markets for foreign investors is so critical," said Jan Dehn, head of research at the London-based investment management company Ashmore.

More foreign investment in Chinese stocks is expected, and "first movers will benefit from having exposure (to Chinese shares)", Dehn added.

China's SSE Composite Index has increased from index value of 3,135.92 at the beginning of the year to 3,262.08 on Friday.