Chinese market

R

radioactivem

Guest
Hi Does anybody know what the general outlook is for the chinese market? If there is a correction what would be the worst case scenario (i.e. could it be in the range of 50% or more?) Is the current index of ~4000 on the composite index (http://finance.yahoo.com/q?s=^SSEC) sustainable at all?
I'm looking at investing a given amount in a china linked fund over the long term but am wondering if it would be better to hold off just for the moment until things become more stable.
thanks!
 
I'm don't know much about Chinese stocks, but I did hear that Price-to-earnings ratios were about 50 on average for one particular index, in Europe and the US they are about 15-20.

Also the government seems to want to take some heat out of the market, this week they announced they would let the yuan appreciate at a slightly faster speed.
 
Well, I am quite familiar with chinese stock market, since some money has been involved. As you said, now the index is above 4000, which is the peak along the history. The reason for this probably could be traced back to the international hot money inflowing, which aims to bid the yuan appreciation.
 
longarrow said:
Well, I am quite familiar with chinese stock market, since some money has been involved. As you said, now the index is above 4000, which is the peak along the history. The reason for this probably could be traced back to the international hot money inflowing, which aims to bid the yuan appreciation.
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Given your familiarity I would have expected you to realise that the opportunity to invest in the Shanghai Composite index is available only to Chinese citizens. Not to foreigners. Although I believe the rules might be sufficiently relaxed that you can apply for special dispensation from the government to invest there.

Many of the companies on the index are dual-listed on the Hang Seng index but the companies trade at a premium on the Shanghai Composite.

See more general discussion here: http://www.askaboutmoney.com/showthread.php?t=55099
 
Greenspan thinks the Chinese market is in for a big fall -

[broken link removed]

With all the other warnings, I personally would not touch it with a bargepole!
 
room305 said:
the Shanghai Composite index is available only to Chinese citizens.
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I'm looking at this from the point of view of a non Chinese investor.

How would a fall in the Shanghai Composite index affect the indices available to Westerners such as the Xinhua China 25 in particular ?

Is the apparent 'bubble' greater in the Shanghai Composite index or are all Chinese based indexes in trouble if the Shanghai Composite index crashes?
 
sign said:
I'm looking at this from the point of view of a non Chinese investor.

How would a fall in the Shanghai Composite index affect the indices available to Westerners such as the Xinhua China 25 in particular ?

Is the apparent 'bubble' greater in the Shanghai Composite index or are all Chinese based indexes in trouble if the Shanghai Composite index crashes?
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Other Chinese indices have not enjoyed the same gains so they probably won't fall as hard. However, it is hard to imagine they will emerge unscathed, for reasons of sentiment if nothing else.

Whether this presents an opportunity or not will depend on your longer term view of Chinese equities and the Chinese economy.
 
Alan Greenspan is predicting a bust in the chinese stockmarket. This would have a big negative impact on US/EU markets similiar to last year.
 
According to Bloomberg TV last night, the big investment firms are reducing their exposure to China while average Joe's are piling in. Isn't that generally considered to be a sign of imminent problems?
 
You miss the point, a fall in US/European markets following a fall in the chinese market.
 
Privinv said:
You miss the point, a fall in US/European markets following a fall in the chinese market.
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Markets are forward discounting mechanisms so abrupt changes usually only occur in response to unexpected events. If investors in the US/EU markets are going to sell in a panic when the Chinese market collapses, then why are they still invested now?
 
Is it now a time for spreading some investments elsewhere to avoid a downturn in the chinese market or stick with it ?
 
[Begin sarcastic rant] Hurray for Communist stock markets! Whaddya know?! You can indeed get rich from slavery - those canny good ol' boys in the Deep South back in the day sure knew their stuff!

Today, we can get rich from the enslavement of an entire people too, only nowadays we just hold stocks which profit from their enslavement, rather than holding the whips and cattle prods of yore! Fantastic. [Ends]
 
Sherman said:
[Begin sarcastic rant] Hurray for Communist stock markets! Whaddya know?! You can indeed get rich from slavery - those canny good ol' boys in the Deep South back in the day sure knew their stuff!

Today, we can get rich from the enslavement of an entire people too, only nowadays we just hold stocks which profit from their enslavement, rather than holding the whips and cattle prods of yore! Fantastic. [Ends]
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Since when did communism equal slavery?
 
Sherman said:
Today, we can get rich from the enslavement of an entire people too, only nowadays we just hold stocks which profit from their enslavement, rather than holding the whips and cattle prods of yore! Fantastic.]
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??? The implication here is that chinese people are being forced to work against their will. If this is the case then it is abhorrent. I think you will find it is not the situation though.
 
6.4% sell-off on Chinese market last night in response to increased taxes on shares. Reaction on US indices in pre-market action can only be described as muted.
 
Sherman said:
[Begin sarcastic rant] Hurray for Communist stock markets! Whaddya know?! You can indeed get rich from slavery - those canny good ol' boys in the Deep South back in the day sure knew their stuff!

Today, we can get rich from the enslavement of an entire people too, only nowadays we just hold stocks which profit from their enslavement, rather than holding the whips and cattle prods of yore! Fantastic. [Ends]
Click to expand...

I'm sorry for having to post again, but I've just got to say this is one of the most ignorant pieces of writing of seen on the internet. Ever.
 
jbax said:
I'm sorry for having to post again, but I've just got to say this is one of the most ignorant pieces of writing of seen on the internet. Ever.
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Oh bless. You must be quite new to the internet then? Stick with it, you'll see far worse. Wait until the politicians all have their own blogs ;)
 
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