China Shares

[Dr_Who]

I am thinking of putting some money in China Shares.

Any recommendations or ideas?

Just watch the incredible turnover of CCB, just amazing!! Makes NZ sharemarket look like mickey mouse.

[ananda77]

Hi Dr.Who,

...here are some links which should help understand the precarious position China is in at present; although their markets have seen tremendous downside, the question for China is how long it will take them to restructure their complete dependence on exports and develop the domestic market.

...can they adjust quickly???

-China and the Global Financial Crisis

-Saving the Chinese Economy from the Global Financial Crisis

-Specific Measures to Restore China's National Destiny
http://www.henryckliu.com/

Kind Regards

[bear]

I am thinking of putting some money in China Shares.

Any recommendations or ideas?

Just watch the incredible turnover of CCB, just amazing!! Makes NZ sharemarket look like mickey mouse.


Hey Dr, Check out IZZ on the ASX looked at them a while ago but haven't recently.

You either like listed trusts or despise them

They invest in FTSE/XINHUA China 25 Index most sectors covered but mainly in banks, telcos, oil and gas and insurance and have about 22% cash

trust this helps

[AMR]

Hey Dr, Check out IZZ on the ASX looked at them a while ago but haven't recently.

You either like listed trusts or despise them

They invest in FTSE/XINHUA China 25 Index most sectors covered but mainly in banks, telcos, oil and gas and insurance and have about 22% cash

trust this helps

On the lines of listed funds there's also AGF, AMP China Growth fund.

Or you could use your CMC account to buy Hong Kong shares.

[seaosh]

I'd forget about wading through the writings of this C.K. Liu nutter.

[Dr_Who]

Thanks guys. I am not much of a listed trust believer. I prefer to research firms myself and invest in it.

I am looking at firms that will benefit from the huge $1 trillion govt stimulus. Maybe firms with infrastructure development. Most of the stimulus funds will go into infrastructure development.

I dont know much about firms in HK and China, so some brain storming is in order. Forget about the NZ market it is a a dead duck. China is the play.

[graeme50]

And the US. I invest in the US market. You can buy Chinese share listed on the NASDAQ, NYSE, OTC and PK. But there is a lot of money to be made on the US market as I have found out even in this bear market. look at ACTC Advanced Cell Technology. Stem cell companies will explode as soon as OBAMA lifts the Stem Cell funding ban BUSH place on them 8 years ago

[AMR]

You will like this Dr Who. From Colin Twiggs of Incredible Charts.

The Shanghai Composite Index broke out from its downward trend channel on the weekly chart, indicating that the primary down-trend is weakening.
http://www.incrediblecharts.com/tradingdiary/images/20090205_ssec_w.png
The index has now recovered above its December high, signaling reversal to a primary up-trend, accompanied by a strong surge on Twiggs Money Flow (21-Day). This offers a target of 2400, calculated as 2100 + ( 2100 - 1800 ).
http://www.incrediblecharts.com/tradingdiary/images/20090205_ssec.png
This is supported by a December increase in steel production, after 5 months of negative growth.
http://www.incrediblecharts.com/tradingdiary/images/20090205_china_steel.png
But the Shenzhen Composite Index is ambivalent: the December retracement would not qualify as a secondary reaction — so the primary trend has not reversed.
http://www.incrediblecharts.com/tradingdiary/images/20090205_szsc.png
It would be prudent to wait for a retracement that respects the new support level of 2100 on the Shanghai Composite Index.

[AMR]

AMP China fund confirms. The price did a double bottom just before december and retested the new support level before breaking the downtrend line. There is still potential resistance above at 87c and possibly some resistance at the 200 day EMA as the fundies sell.

[zyreon]

Not sure what stocks to buy exactly, but came across a news website on the Chinese economy: www.chinaeconomicscan.com they put out daily updates.. top 5 headlines etc. There was one thing on there that caught my eye about a chinese video game manufacturer planning to IPO next week. But yeah, with global growth forecast to be -1.5%? and China at about 6.5% maybe it is a good place to put your money!

[zyreon]

Not sure what stocks to buy exactly, but came across a news website on the Chinese economy: www.chinaeconomicscan.com they put out daily updates.. top 5 headlines etc. There was one thing on there that caught my eye about a chinese video game manufacturer planning to IPO next week. But yeah, with global growth forecast to be -1.5%? and China at about 6.5% maybe it is a good place to put your money!

So that IPO happened, Changyou.com they priced at at the top end of the range at $16, and it closed fully subscribed - very positive event given the current environment. It closed on the NASDAQ at about $19.40 http://finance.yahoo.com/q?s=CYOU so a good outcome there. SOHU still holds 71% of them... http://finance.yahoo.com/q?s=SOHU

[Dr_Who]

So that IPO happened, Changyou.com they priced at at the top end of the range at $16, and it closed fully subscribed - very positive event given the current environment. It closed on the NASDAQ at about $19.40 http://finance.yahoo.com/q?s=CYOU so a good outcome there. SOHU still holds 71% of them... http://finance.yahoo.com/q?s=SOHU

Good on ya Zyreon.

If there are more IPOs like this one, pls do let us know.

Cheers mate.:)

[Dr_Who]

Anyone here invests offshore?

Far better gains in overseas stock than local. China stocks have been going gang busters lately.

[shasta]

Anyone here invests offshore?

Far better gains in overseas stock than local. China stocks have been going gang busters lately.

Check out ASX:AGF - a fund that tracks the Chinese market

Toulouse-Lucern was into them a while back ;)

[Dr_Who]

Yeah, some of my Asian shares are booming.

Much more exciting than the NZ blue chip stocks with the exception of NPX... LOL

[Dr_Who]

Hey Bel, which country is that stock and company name?

[lakedaemonian]

BIDU ... Now good for over a 100% gain in just six months ... :)

Near identical performance(6 month, 2 year) to the two US listed Chinese stocks I've posted on before:

SNDA : Shanda Interactive

ADY : American Dairy

They both outperformed Baidu by a healthy margin on the 1 year. :)

I am MORE than happy to sit in cash-like for now.

Everyone's surely heard of MAD(Mutual Assured Destruction).

MEAD(Mutual Economic Assured Destruction) is the new MAD! :)

While it seems trade between the US/China is declining......I don't see how they will avert the next global leg down triggered by:

Commercial Real Estate(already collapsing)

Pensions....defined benefit pensions both corporate, and local/state government(starting to get the speed wobbles)

My long-term, multi-decade investment strategy will include anywhere from 25-40% allocation in a China-focused Asia.

But not until I feel we have a firm foundation for "Monopoly 2.0".

I'm hearing some worrying anecdotal information out of China.

It continues to be a very volatile trading environment...and I'm not much of a trader.

I'm bullish on China long-term....but I think they have a lot to worry about over the next 5-10 years......but a fair bit less so than US/UK/EU.

Once my inflation hedging strategy has finished playing out and I'm ready to dive in, China will be a key focus....but not until then.

Just my 0.02c

[newbietrader]

i dont have access to China market directly..but have access to Singapore/HK shares which l subscribed to when I was working there..

the site I go to www.poems.com.sg

[Bouncerdog]

I wanted exposure to China and India and so used USA based ETFs trading on NYSE - which used to be available through the old National Bank/First Capital share broking set up. The new people don't like to do that, which is a shame.

I managed to buy in when the NZD was strong and so am happy with my long-term investment. I like the fact that ETFs/index trackers have low costs/fees. I am allergic to all sorts of financial managers/advisers who take money without adding value. They make me come out in big blotches of poverty and bitterness.

Everything I read about financial planning tells me to look outside of little old New Zealand and spread your investments- but it seems really difficult to actually invest in a focussed international fund that doesn't charge an arm and a leg. The US ETFs sort of offer that, but then life becomes complicated with taxation issues - and the need for full service brokers to actually trade.

We have the SMART products on the NZX already. It would be neat if they could expand that family to provide focussed global exposure in baskets of shares in large cap India, or energy focussed China, or commodities based in Africa, or whatever.

Couldn't Mark Weldon do a deal with some US based ETFs to have them listed on the NZX? And who knows, perhaps the tide would turn, and Aussie dollars would start flow into the NZ Exchange?;)

[dragonz]

I wanted exposure to China and India and so used USA based ETFs trading on NYSE - which used to be available through the old National Bank/First Capital share broking set up. The new people don't like to do that, which is a shame.

I managed to buy in when the NZD was strong and so am happy with my long-term investment. I like the fact that ETFs/index trackers have low costs/fees. I am allergic to all sorts of financial managers/advisers who take money without adding value. They make me come out in big blotches of poverty and bitterness.

Everything I read about financial planning tells me to look outside of little old New Zealand and spread your investments- but it seems really difficult to actually invest in a focussed international fund that doesn't charge an arm and a leg. The US ETFs sort of offer that, but then life becomes complicated with taxation issues - and the need for full service brokers to actually trade.

We have the SMART products on the NZX already. It would be neat if they could expand that family to provide focussed global exposure in baskets of shares in large cap India, or energy focussed China, or commodities based in Africa, or whatever.

Couldn't Mark Weldon do a deal with some US based ETFs to have them listed on the NZX? And who knows, perhaps the tide would turn, and Aussie dollars would start flow into the NZ Exchange?;)

This is a very good post Bouncerdog. I hope you send a copy to Mark Wheldon.

[Dr_Who]

See http://www.baidu.com/ ... its the chinese google ... Ask any chinese internet surfer and they'll mention it straightaway. Traded in the US.

Doesnt google have search in the Chinese language?

[lakedaemonian]

I wanted exposure to China and India and so used USA based ETFs trading on NYSE - which used to be available through the old National Bank/First Capital share broking set up. The new people don't like to do that, which is a shame.

I managed to buy in when the NZD was strong and so am happy with my long-term investment. I like the fact that ETFs/index trackers have low costs/fees. I am allergic to all sorts of financial managers/advisers who take money without adding value. They make me come out in big blotches of poverty and bitterness.

Everything I read about financial planning tells me to look outside of little old New Zealand and spread your investments- but it seems really difficult to actually invest in a focussed international fund that doesn't charge an arm and a leg. The US ETFs sort of offer that, but then life becomes complicated with taxation issues - and the need for full service brokers to actually trade.

We have the SMART products on the NZX already. It would be neat if they could expand that family to provide focussed global exposure in baskets of shares in large cap India, or energy focussed China, or commodities based in Africa, or whatever.

Couldn't Mark Weldon do a deal with some US based ETFs to have them listed on the NZX? And who knows, perhaps the tide would turn, and Aussie dollars would start flow into the NZ Exchange?;)

But wouldn't that open the floodgate to easy offshore investment options?

Wouldn't that magnify the "Sword of Damacles" hanging over our collective NZ heads in the form of already insufficient domestic savings/investment?

Wouldn't that possibly result in further thinning out of the NZX by way of more attractive foreign competition?

Wasn't the whole Cullen led debacle of taxing UNREALIZED gains from foreign investment a means to scare money towards NZ options and away from foreign options?

I would love to see low cost domestic and foreign ETF options available locally, but I'm not confident it's in the best interest of the powers that be for the slowly growing pot of Kiwisaver money to leave NZ and avoid local ticket clipping.

Just my pessimistic 0.02c

[Bouncerdog]

All very good points.

Funny how we moan about EU and USA dairy subsidies when we have our own form of investment protectionism in place here in NZ.

“I would love to see low cost domestic and foreign ETF options available locally” .

So why not? How hard can it be to make that happen? Market-led product development.

Must be a bunch of entrepeneurs and investors who could put that together. Surely plenty of financially savvy individuals out there looking for opportunities after all those finance companies went belly up.

I’d buy a few shares in it. :)

[CycleTrader]

Interesting thread - my first post so you guys with thousands of posts be gentle!!

I'm bullish on China but like others more for the medium to long term. My question though is when investing from NZ what view are you taking on the currrency exposure NZD/CNY? Seems to me that longer term we should see the Yuan stronger (superficial analysis based on my perception of China getting relatively stronger economically!) If so then that would act to accelerate any direct gains from holdings in China the earlier the investment is made?

Am I on track here?

Cheers
CT

[Dr_Who]

Bouncerdog... try CMC markets. They have international stocks at a very low brokerage rate. Would be very careful with CFDs especially if you are a novice investor. Would recommend you get to know the product very well before investing real cash.

Cycletrader... I am assuming the Chinese Yuan to be the main focus in the future. China is pushing to move out of the USD and into either using the Yuan or another form of a single currency. China have already signed deals with a number of countries to trade in the Yuan and not the USD. I have money in Hong Kong dollar, cos if the Yuan was to float and depegged from the USD it will also benefit the HK dollar.

[Bouncerdog]

Dr Who - Thanks for that.

I'll have a look at CMC. And yes, I am very cautious about CFDs, margin trading, geared investment or whatever other term is given to things that I know very little about and find a bit scary...

I guess I am an old novice;)

[AMR]

Most brokers here don't offer the Yuan. There was one on the waterfront in Auckland who were doing them....

In any case long term "carry trades" don't work as CFDs because the broker takes a bite out of the interest rates on each side.

[CycleTrader]

Cheers Dr Who & AMR

So basically, like investment in any foreign shares if you expect that counties currency to strengthen relative to NZ (eg Yuan) then that gives you an extra reason to consider such an investment if your ultimate goal is NZ income and capital appreciation in NZ$? My focus being on medium/long term rather than trading.

Probably seems sefl evident but early/novice days for me and I do appreciate the wisdom (& wit) on the forum.

Cheers
CT

[beacon]

I wanted exposure to China and India and so used USA based ETFs trading on NYSE - which used to be available through the old National Bank/First Capital share broking set up. The new people don't like to do that, which is a shame.

I managed to buy in when the NZD was strong and so am happy with my long-term investment. I like the fact that ETFs/index trackers have low costs/fees. I am allergic to all sorts of financial managers/advisers who take money without adding value. They make me come out in big blotches of poverty and bitterness.

Everything I read about financial planning tells me to look outside of little old New Zealand and spread your investments- but it seems really difficult to actually invest in a focussed international fund that doesn't charge an arm and a leg. The US ETFs sort of offer that, but then life becomes complicated with taxation issues - and the need for full service brokers to actually trade.

We have the SMART products on the NZX already. It would be neat if they could expand that family to provide focussed global exposure in baskets of shares in large cap India, or energy focussed China, or commodities based in Africa, or whatever.

Couldn't Mark Weldon do a deal with some US based ETFs to have them listed on the NZX? And who knows, perhaps the tide would turn, and Aussie dollars would start flow into the NZ Exchange?;)

That'll bring some of my funds back to NZ, and NZX can happily have their cut. At the moment they are getting bugger all from me.

[Toulouse - Luzern]

Check out ASX:AGF - a fund that tracks the Chinese market

Toulouse-Lucern was into them a while back ;)

I exited ASX.AGF early in the downturn.

Now we are on the up again...

ASX iShares are an option for offshore investment component of a portfolio
You can invest in several indexes including China ASX.IZZ.

I will send a link on current performance in following post.

I currently hold:
ASX.IHK Hong Kong
ASX.ISG Singapore

DB SuperChart 6 month comparison of iShares IZZ and AGF show similar % outcomes

[Toulouse - Luzern]

Here are a couple of links:
Note that some trade fairly low volumes ...

IShares Performance link

http://au.ishares.com/publish/content/documents/pdfs/mpr_au.pdf

iShares home.

http://au.ishares.com/index.do

[Dr_Who]

Its funny how the shares in Hong Kong market dont trend the China market.

[Toulouse - Luzern]

You are correct Dr Who, there is little co-relation ...

For example today:

The Shanghai SSEC is up 3.13% at this minute and ASX IZZ is up 6 cents and .1% an volume of 16614 shares...

Hang Seng is up .99% and on the ASX IHK is down 4 cents on volume of just 9 shares...

Strait Times Index STI Singapore ASX ISG has not traded at all... the index is up .5%...

ASX.AGF (AMP China Growth Fund) is up 2 cents or 1.9% on volume of 218,798 shares

My conclusion is the volumes on ASX for ishares are not large enough ...

there is often no response ...

or co-relation ...

[Dr_Who]

Shanghai index is heart attack territory.

Up and down 6-7% daily... WOW!

Very profitable if you pick it right.

[CFO]

Would recommend sticking to mature platforms. China's shares have been on a rollercoaster ride simply because the market is highly restricted. Hong Kong is a better idea. Direct CHina investment by foreigners is possible through authorized QFIIs only.

Any BRIC market will show pretty much the same volatility. If you are feeling adventurous, check out Russian listings on London's AIM or even at RTS and MICEX.

[Dusty]

Possible double bottom on the AGF chart at $1.05, Shanghai index is on its way back up, above 3000 today and has already had the 'impending correction' that many predict is coming for the western markets, imo.

As I said on the LGL thread gold would breach $1000 by the end of the year, China has been buying Gold as a hedge against the falling USD so with futher falls in the USD coming because of many fundamentals seemingly against the USD I think we may see Gold and the Shanghai index strong in the near term.
Response to the US-Sino tariff war was muted so as long as this doesn't escalate I'm in.
Bought in yesterday $1.075, stop loss just below double bottom support level, as always would appreciate the ST fellas comments.

[Hoop]

Dusty quote "...Possible double bottom on the AGF chart at $1.05, Shanghai index is on its way back up, above 3000 today and has already had the 'impending correction' that many predict is coming for the western markets, imo...."

Yes my thoughts too.

As I said in my post#3(24 07 2009) the Goldilocks and the three bears thread (http://www.sharetrader.co.nz/showthread.php?t=7008)quote.... Update: - Most of The worlds Equity indexes are in differing Bull Market phases The Shanghai index being the most mature of those mentioned in this thread.

From the chart below this latest bull market correction came exactly on cue ....for a highly regulated Country, the Shanghai Index is so predictable that it reaches the point of being spooky.

You get the idea of when the second correction may occur if the bull market continues.

Edit: Oooops....the green inverted H&S is drawn wrong ..the shoulders are to high..should be drawn at just over 3000 not at just under 4000... Drawn correctly allows for the rapid fall/rise (arms) before for the correction




http://i458.photobucket.com/albums/qq306/Hoop_1/shanghai16092009.png

[tplus]

Hi, any recomendations for brokers for direct investment in the China market. Cheers.

[Toulouse - Luzern]

Sorry can't help - I have not bought any direct.

I understand the SSEC etc will open again Monday after being closed during the PRC 60 anniversary meetings.

Given the US DJ is at a 12 month high, world markets generally are smiling again, things with OZ Rudd and RIO are better etc then we may expect China to trend up again ...

Opportunities to Invest Indirect - ETFS:
A very thin market for China related ETFs on the ASX...

Barclays iShares IZZ on the ASX is a China ETF but the ASX average daily turnover average over 3 months for IZZ is only 8992 shares. iShares IHK Hong Kong average volume is 5565 and ISG Singapore average volume is 2805.

By comparison the ASX200 SPDR STW turnover on the ASX on Friday was 852,470

AGF.ASX the AMP China Growth fund average daily volume over 3 months is 291,950 - so more of a market for this one.

rgds

[CFO]

You cannot invest directly in China, only Hong Kong.

[Dr_Who]

There is a large number of Chinese companies listed on the HK market.

[stone small green]

you will need to have to identification to open a account in china,
unless you uses someone else's account.

[wbosher]

This doesn't make great reading, probably no huge surprise to anyone though.

http://www.scribd.com/doc/26781802/China-The-Mother-of-All-Black-Swans-By-Vitaliy-Katsenelson

[Dr_Who]

This doesn't make great reading, probably no huge surprise to anyone though.

http://www.scribd.com/doc/26781802/China-The-Mother-of-All-Black-Swans-By-Vitaliy-Katsenelson

Good slide show. I tend to agree.

I have sold out most of my Asia exposure stocks, hence I have also sold out of my resources stocks late last year. I am also abit concern about China. If China goes, the whole world goes. Here is hoping it stays on track.

[percy]

This doesn't make great reading, probably no huge surprise to anyone though.

http://www.scribd.com/doc/26781802/China-The-Mother-of-All-Black-Swans-By-Vitaliy-Katsenelson

thank you wbosher.Bit of a nasty wake up call.

[peat]

A collision with the United States now seems inevitable. It is therefore important to understand the forces driving China, and it is time for STRATFOR to review its analysis of China.
An Inherently Unstable Economic System

China has had an extraordinary run since 1980. But like Japan and Southeast Asia before it, dramatic growth rates cannot maintain themselves in perpetuity.

STRATFOR sees a race on, but it isn’t a race between the Chinese and the Americans or even China and the world. It’s a race to see what will smash China first, its own internal imbalances or the U.S. decision to take a more mercantilist approach to international trade

Full article here

http://www.stratfor.com/weekly/20100329_china_crunch_time?utm_source=GWeekly&utm_medium=email&utm_campaign=100330&utm_content=readmore&elq=582b728d5a7141c88ef2763606bfe301

[beacon]

A collision with the United States now seems inevitable.

Match or war ... whatever ... appears postponed for the time being.

[ananda77]

Match or war ... whatever ... appears postponed for the time being.

Great Power Rivalry. China's Role as America's Creditor
"From Export Juggernaut to a Credit Addict"

by Mike Whitney http://www.globalresearch.ca/index.php?context=va&aid=18516

"China is headed for trouble. It's economy is reeling from overinvestment, underconsumption, and razor-thin profit margins. That's a tough mix in the best of times; and these aren't the best of times. When the bubble starts to unwind; defaults will increase, consumption will drop and economic activity will slow to a crawl. That will force the renminbi to rise whether the Party bosses like it or not.

China's business model is deeply flawed. The domestic market needs to expand so there's less dependence on exports. Personal consumption is the key, which means that wages and living standards will have to rise. The government needs a wealth-distribution plan--like the New Deal--to increase demand and create a thriving middle class. And that's the rub, because the class war goes on in China just as it does in United States.

Kind Regards

[Dr_Who]

Amazing!

According to the People's Bank of China, China's foreign exchange reserves hit a new high of 2.4471 trillion U.S. dollars at the end of March. That's up 25 percent from last year. The PBOC says China's foreign exchange reserves increased 48 billion U.S. dollars in the first quarter, compared to a gain of 126.5 billion U.S. dollars in the fourth quarter.

US $13 trillion DEBT
China $2.45 trillion CASH

[peat]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10646107&pnum=3

Danger signs all too real for China


the only two countries to have accumulated such large foreign exchange reserves, relative to global GDP, were the United States in 1929 and Japan in 1989".

[Dr_Who]

I actually think that there is a good opportunity to invest in China or China related stocks with further weakness in their market during tightening. As long as China can keep up their growth figures and have their currency pegged to the USD they should be able to ride out the growing pains. I am seeing this downturn as a opportunity and not a doom story.

[peat]

Dispatch: China's GDP and Questions of Strength | STRATFOR
http://shar.es/03QRF
China’s gross domestic product (GDP) is close to surpassing Japan’s to become the second largest in the world. Analyst Rodger Baker explains the multiple fundamental weaknesses in China’s economic system and why GDP is not the only indicator of a state’s economic strength.

[Hoop]

Reading media....we unfortunately get the Westernised version and mostly from the USA point of view.
OK.. China may have unorthodox economic methods and big economic problems ...who hasn't got economic problems at the moment.

A good defense to an argument is too make it as complicated as one can so to confuse or to overload your opponents with useless facts and figures.

What happens if we simplify things by asking 2 basic questions...

Which country has the most spare cash in this world? ..
Which country has the most debt in the world?

Hint:..... from the Wall St Journal (out of date now ...Dec 2009)..... China Remains Biggest Holder of USA Debt (http://online.wsj.com/article/SB10001424052748704093204575216680676960908.html?m od=WSJ_hpp_MIDDLENexttoWhatsNewsThird)