Chinese stocks are simply companies that are based and trade domestically in China and/or are also listed on foreign stock exchanges, namely the United States. Chinese stocks allow aggressive investors to buy companies where the majority of the business is in China, hence Chinese stocks are a play on the growth of China. In China, the major companies are listed on the benchmark Shanghai Composite Index.
While it’s true that China-based companies have subjected U.S. capital markets with erroneous results and reporting, it doesn’t mean you should bypass Chinese stocks—you just need to be extra careful.
The situation has improved and will get better for investors looking at Chinese stocks listed in the U.S. The Securities Exchange Commission (SEC) has revamped the listing requirements for Chinese companies and has forced Chinese companies looking to list in the United States to use approved auditors, along with other, tighter reporting requirements. China may not be in the spotlight for investors now, as was the case a few years back, but you cannot ignore the country. With the recent years of under performance, we see excellent risk-to-reward longer-term upside in Chinese stocks.
A few years ago, investors couldn’t get enough of Chinese stocks. This led to numerous frauds committed by crooks in China that has since tarnished the reputation and reliability of all Chinese companies, whether they’re legitimate or not, despite their operating in one of the top growth areas in the world.While I’m not focused. Read More
If you think Chinese stocks are too speculative to consider and buy, then you need to read what I’m going to say over the next few paragraphs.Yes, it’s true that China-based companies have subjected U.S. capital markets to erroneous results and reporting in the past and that it is likely continuing to some degree, but that does not. Read More
For the first time in more than three years, Chinese stocks are beginning to show some promise for growth investors looking for opportunities outside of the United States.The benchmark Shanghai Composite Index has moved to just above its close of 2013; hence, it’s more or less in line with the S&P 500 and Dow Jones Industrial Average.. Read More
We all know about some of the insane valuations with social media and Internet services stocks, such as Twitter, Inc. (NYSE/TWTR), Facebook, Inc. (NASDAQ/FB), and Yelp, Inc. (NYSE/YELP), as I have discussed in these pages before. (Read “Two More Internet Stocks to Watch.”)These valuations make it extremely risky to buy, as a change. Read More