The Chinese currency is expected to appreciate 10% this year against Dollar. Equity market is still booming after the recent correction. Given the trough in U.S from subprime, anyone interested to invest China Market? Just would like to know your take. Thanks
No. Have you seen the articles on Bloomberg about maids in Shanghai, giving up their day-jobs to trade stocks?! SELL
Yeah, the market will likely pop sometime this year, and it’s very likely to be ugly. So maybe buy volatility there, if you can. Bouquets of put-call combinations might be sensible, but you don’t want to buy the regular stuff at the top, you don’t want to short (much) before the top, and the top is going to be hard to see until it’s too late. It may make sense to close open long positions, though.
I’m getting ready to sell the china market short again using the twice levered FXP etf after the recent rebound. Seriously just check out annual returns for countries hosting the Olympics leading up to the Olympics then immediately afterwards. This added with an incredibly overheated market as Etienne mentioned will likely put downward pressure on it for the next year. Plus China will stop most of the industrial production 3 months before the olympics to clear the air. Are you serious? Over a long period sure, but I don’t think this is the time to get in. If you do have clients you also realize as soon as the laymen start talking about investing in China, its probably the time to sell.
I wonder if a major stock market correction would be motivation for China to let the Yuan appreciate.
How do you analyze the financial statements of the companies in china? There are no rules for the game in China. Collecting inside information is the only way you can win money over there. HK market is a good proxy though. Buffett won millions of dollars there.
Cat Fancier, I was just in Shanghai. I know what you mean about the olympic hype but they’ve got the “post-olympic” swoon fixed… they’re already promoting the “2010 World Expo”
Cat Fanciers’ Association Wrote: ------------------------------------------------------- > I’m getting ready to sell the china market short > again using the twice levered FXP etf after the > recent rebound. Seriously just check out annual > returns for countries hosting the Olympics > leading up to the Olympics then immediately > afterwards. This added with an incredibly > overheated market as Etienne mentioned will likely > put downward pressure on it for the next year. > Plus China will stop most of the industrial > production 3 months before the olympics to clear > the air. Are you serious? Over a long period > sure, but I don’t think this is the time to get > in. If you do have clients you also realize as > soon as the laymen start talking about investing > in China, its probably the time to sell. I didn’t know this existed… Being London-based, we have fewer ETFs here and they haven’t been on my radar screen for long. Is there anything I need to know about ETF investing that is fundamentally different?
cfafrank Wrote: ------------------------------------------------------- > How do you analyze the financial statements of the > companies in china? There are no rules for the > game in China. Collecting inside information is > the only way you can win money over there. HK > market is a good proxy though. Buffett won > millions of dollars there. I don’t know how you do the fundamentals, but China strikes me as a market where technical analysis is likely to work pretty well. Fundamentals are mysterious, psychological frenzies, this is where TA is more likely to be useful.
But will the govt allow the bubble to burst before the olympics and accept the negative consequences of it, that is the big question
I think that so many people are saying “no bubble burst” before the olympics that they may just pile in massively unrealistically and drive up prices to amazingly unsustainable levels that just make the whole thing unstable. Then POP! The big question, I guess, is whether the Chinese government will use its Trillions in sovereign wealth to prop up its own teetering stock market. From the perspective of the fund manager, it’s probably a very bad idea, but from the perspective of the government that owns the fund, it may not be.
Cat Fanciers’ Association Wrote: ------------------------------------------------------- > Seriously just check out annual > returns for countries hosting the Olympics > leading up to the Olympics then immediately > afterwards. Is that your argument ?? Just for fun, if the Olympics had an impact on a country the size of Greece does that mean it will have an impact on an economy the size of China ?
Yes actually it is. Let’s see some examples: Japan, Germany, Mexico, Canada, California, Korea, Spain just to name a few all had considerable growth contractions the following years. I’m not saying China is all of a sudden going to have a recession but considering money has piled in there the past several years and growth expectations area high in leiu of the government’s attempts to slow it down (ie. Steay Increases on Reserve Requirements) this is not the time to put money into the economy in my opinion. There remain far greater infrastructure concerns for them at this point.
I am in it right now…although my position is minimal right now, I basically cashed out before new year. Now in the hold and see stage… I personally think it’s hard for westerner to understand the Chinese market because the way it operates is very different…fairly unregulated compare to the U.S. market.
bchadwick Wrote: > I don’t know how you do the fundamentals, but > China strikes me as a market where technical > analysis is likely to work pretty well. > Fundamentals are mysterious, psychological > frenzies, this is where TA is more likely to be > useful. Damn, I started regretting writing CFA exams already. F@#$ FSA & valuation! CFA is just another bubble bulit by people from Wall St…
I bring this up because as we all know the Chinese market has sucked. I bought FXP at 67 and sold it way too early at $88 but I’m actually now thinking about going long the market. Anybody else thinking about it? I mean its down nearly 60% from the peak. I think given the global slowdown with an economy still growing at nearly 10% annually this could be a great entry point. I haven’t put any money in yet but I’m getting close. Anyone else?