Can we invest directly in Chinese market for :
1) IPOs/Indivual stocks like ADRs
2) MFs
Is there any MFs offered by Vanguard/fidellty etc which invest ONLY in chinese or major % in chinese market ?
Pls advise.
Chinese investments
Chinese investments
GMB;4625Can we invest directly in Chinese market for :
1) IPOs/Indivual stocks like ADRs
2) MFs
Is there any MFs offered by Vanguard/fidellty etc which invest ONLY in chinese or major % in chinese market ?
Pls advise.[/quote]
I do not know if as an individual you are allowed to invest directly in the Chinese market or their IPOs.
However you can invest in Chinese ADRs and / or IPOs of the ADRs (don't know what that buys you :confused: ).
Same thing with MFs. I do not know if as a US individual whether you are allowed to directly participate in Chinese MFs and even if you are (which I doubt), that would be under PFIC purview.
However, you can buy mutual funds that are US based but invest solely in Chinese markets and there are many. Matthews Asian funds has one and FXI is an ETF of the top 25 companies in China that you can buy on NYSE.
Of course you can buy ADRs on the US exchanges. In addition Chinese investments are a component of many international funds.
-
FreeSpirit
- Posts: 148
- Joined: Fri Jan 26, 2007 10:01 pm
Chinese investments
What I'm hearing is that valuations in Chinese stocks has reached bubble levels. Here's a report from WSJ:
From WSJ:
[INDENT]As China's stock market continues its record-breaking rally, regulators are increasingly expressing concern that the country's growing ranks of investors are doing everything from mortgaging their homes to borrowing against their credit cards to get in on the action.
China's stock-market benchmark, the Shanghai Composite Index, rose 130% in 2006 and has continued to soar this year, placing Chinese stocks among the world's top performers. Yesterday, the index gained 2.2% to 2945.26.
In a frenzy that recalls the late-1990s dot-com boom in the U.S., the rally has drawn in a new generation of investors. Online trading is spreading rapidly, and in recent weeks individuals have been opening stock-trading accounts at the rate of about 90,000 per day, 35 times the pace of a year earlier.
...
The valuations of some Chinese stocks are "approaching bubblelike levels," said Michael Hartnett, global emerging-markets strategist at Merrill Lynch. In particular, the shares of some Chinese financial institutions are now trading at between four and five times their book value, which is roughly double the equivalent figure for their U.S. counterparts.
According to investment bank UBS, Chinese stocks now trade at a price/earnings ratio of about 33 times, while Hong Kong stocks are closer to 18 times. Most analysts say stocks in China will remain expensive because the market is too small in comparison with the overall economy and the nation's $2 trillion in bank deposits.
[/INDENT]
From WSJ:
[INDENT]As China's stock market continues its record-breaking rally, regulators are increasingly expressing concern that the country's growing ranks of investors are doing everything from mortgaging their homes to borrowing against their credit cards to get in on the action.
China's stock-market benchmark, the Shanghai Composite Index, rose 130% in 2006 and has continued to soar this year, placing Chinese stocks among the world's top performers. Yesterday, the index gained 2.2% to 2945.26.
In a frenzy that recalls the late-1990s dot-com boom in the U.S., the rally has drawn in a new generation of investors. Online trading is spreading rapidly, and in recent weeks individuals have been opening stock-trading accounts at the rate of about 90,000 per day, 35 times the pace of a year earlier.
...
The valuations of some Chinese stocks are "approaching bubblelike levels," said Michael Hartnett, global emerging-markets strategist at Merrill Lynch. In particular, the shares of some Chinese financial institutions are now trading at between four and five times their book value, which is roughly double the equivalent figure for their U.S. counterparts.
According to investment bank UBS, Chinese stocks now trade at a price/earnings ratio of about 33 times, while Hong Kong stocks are closer to 18 times. Most analysts say stocks in China will remain expensive because the market is too small in comparison with the overall economy and the nation's $2 trillion in bank deposits.
[/INDENT]
Chinese investments
Thanks guys that was eyeopening looking at % growth. I am trying to boraden my investemnt into something more then India and US. I guess i will be sit tight from Chinese (Will just enjoy their new year in Feb)
How about Brazil ? Desi : Any input in that ?
How about Brazil ? Desi : Any input in that ?
-
eserve_investor
- Posts: 12
- Joined: Sun Jan 28, 2007 10:49 pm
Chinese investments
I used to trade in and out of Unibanco ADR (Symbol: UBB) pretty successfully in the mid/late 90s. I remember buying it for like 7 dollar and change and getting rid of it at 25 or so. Rebought it at 5 levels only to sell it back at 18 levels. And so on. This to me, seemed like the brazilian's version of our very own ICICI Bank.
-
Desibabu19
- Posts: 34
- Joined: Wed Dec 20, 2006 2:50 am
Chinese investments
GMB;4647
How about Brazil ? Desi : Any input in that ?[/quote]
GMB,
For the last 3 years and more I have been mentioning Brazil in the MSN Finance forum. Specifically the Brazil Fund BZF. This fund after providing great gains divested completely. The alternative is of course the ETF which has lower expenses and lower turnover.
Now how Brazil does in the next year or two is something I will not predict. One can take a big loss or big gain or something in between. However for long term I am overweight in some specific markets and Brazil is one. Brazil is a large provider to China. The biggest problem is the long sea route. Australia is closer and can provide similar resources to China.