Are there any good Chinese equity investments

China stocks: Beate and Uwe Sander's top favorites

China as an investment destination - some think of a golden future, others of western ignorance and some of an authoritarian party dictatorship. And all three are right and play a role in the decision about investments.

  • What is undisputed: the size of the market in China. 1.4 billion people live here in increasing prosperity.
  • In terms of its economic output, China is the second largest economy in the world. And yet, according to the standards of the index providers MSCI and FTSE, the country is considered an emerging country, which is also weighted low: In the MSCI ACWI (industrialized and emerging countries by market capitalization), the USA accounts for almost 58 percent, while China only accounts for a good five percent.
  • According to its constitution, the country is "under the democratic dictatorship of the people". The People's Republic has been ruled from the beginning by the Communist Party from authoritarian to totalitarian, with allegations of serious human rights violations. Freedom of expression and freedom of the press do not exist in China, for example. The latest example: On February 11th of this year, the state banned the British broadcaster BBC World News in mainland China.

China as export world champion

China is the largest exporting and the second largest importing nation. The USA, Japan, South Korea and Taiwan are the most important trading partners in both areas. The Chinese economy is developing dynamically. For more than twenty years, the extent of state interference in "socialism with Chinese characteristics" has been decreasing sharply. However, the government is still systematically isolating the country from the major players in the western world: Amazon, Facebook, Google and so on currently have no way of entering the Chinese market. Again, this is a huge benefit for Chinese tech giants like Alibaba and Tencent. They operate almost unrivaled in China.

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On November 15, 2020, China signed the contract for the largest free trade area in the world: RCEP (Regional Comprehensive Economic Partnership). It includes the ten ASEAN countries (Brunei, Indonesia, Cambodia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam), as well as China, Japan and South Korea as well as Australia and New Zealand.

Uwe Sander, who has been managing the estate portfolio of stock exchange legend Beate Sander since autumn 2020, assesses the free trade agreement as follows: "In the long term, the chances of being able to enter into a constructive exchange from economic cooperation on environmental and human rights issues will increase. In economic terms, free trade zones all participating states benefits. "

Also see our YouTube interview with Uwe Sander:

China is leaving the corona crisis behind

Yanjun Gast, portfolio manager and Asia expert at LBBW Asset Management, emphasizes in an interview with that China has got the corona spread under control. That is the basis for optimism. Without these prerequisites, there would be no economic upswing. China was the first country to be paralyzed, but was also the first to successfully emerge from the crisis. Another reason is the support of the Chinese state and the central banks.

Kai Kong Chay, portfolio manager at Manulife Investment Management in Hong Kong and manager of the Chinese equity strategy at the Finnish Nordea bank, argues in this direction. According to this, China is now entering a second phase of growth, which will be mainly driven by domestic consumption. Despite the ongoing trade war between China and the United States, exports rose because of the reduced production in the industrialized countries. Chinese exporters gained market share and industrial profits rose. "Investments in fixed assets in Chinese industry are also on the up as manufacturers invest confidently in new production capacity or increased automation. As for consumption, it has been incredibly strong since the second quarter of last year - especially online consumption "says expert Chay.

China's middle class is growing rapidly

Dr. In an interview with in the summer of 2020, Ulrich Stephan, chief investment strategist at Deutsche Bank, highlighted the growing purchasing power of the huge market: "China's middle class has grown faster in the past few decades than in almost any other country Chinese, the group numbered 420 million people (31 percent of the population) ten years later. The consulting firm McKinsey estimates that the Chinese middle class will be 550 million people in the next two years, more than one and a half times the size of today's US population could grow. "

The entrepreneur and investor Ray Dalio coined the saying about the contradictions of the Middle Kingdom: "Every market has its special risks. However, the greatest risk for investors is not to invest in China." Also the stock exchange millionaire and bestselling author Beate Sander - who died on September 28th, 2020 - said shortly before her death in a YouTube interview with "If you don't invest in China, you make a mistake." Beate Sander also provided with excerpts from her then unpublished audio book for her bestseller "Der Aktien- und Börsenführerschein". In it she speaks of the "call East Asia with the giant empire China", which in the trade war with the USA explores the borders on the way to the number one world power.

Currently in second place in the Spiegel bestseller list: The famous "share and stock exchange license".

Joe Biden and the US-China Conflict

Joseph "Joe" Biden is now US President. The conflict between the two strongest economic powers still exists between China and the USA. As part of this competition, the USA is delisting Chinese stocks that are traded on US stock exchanges (ADRs). That would exclude them from US trade. There is also a threat of trade bans that prohibit US citizens and businesses from investing in Chinese stocks. Even after the presidential elections, Donald Trump published an ordinance on November 12, 2020 that issued the first trade bans for Chinese companies. This list was later expanded. On January 14, 2021, Xiaomi was added, the electronics manufacturer and producer of successful smartphones.

What risks can local private investors face as a result of further delisting and trading bans? Uwe Sander sees it this way: "Using the example of Xiaomi, you can see that the announcement that it would delist these stocks because Xiaomi supposedly has close ties to the military has already led to price falls. Against this background, a complete trade ban or obligation would exist Dissolving investments is devastating, "said Sander. And he adds, "I'm not a prophet, but I don't expect the US to go that far and pull it off with multiple companies." Nonetheless, economic tensions will arise even under Biden: "The US still feels it is the most important great power, but China will soon overtake the US."

Joe Biden and Xi Jinping spoke on the phone for the first time on February 11, 2021, but did not approach each other on disputes. Rather, Biden indicated an unchanged tough course towards Beijing. According to the White House, he has expressed concerns about China's unfair economic practices, Hong Kong's repression and Taiwan policy. According to Xinhua News Agency, Xi warned of a confrontation that would be catastrophic for both countries and the world. In addition, the head of state has confirmed that Hong Kong and Taiwan are internal affairs of China. The US should respect Chinese core interests and act cautiously.

What is the effect of the trade war between China and the USA

After the severe slump in the first quarter of 2020, the People's Republic achieved economic growth again in the second quarter, with gross domestic product increasing by 3.2 percent. Regarding this number and other official statistics from the People's Republic, it should be noted: There are voices that they consider to be at least embellished. According to government data, there have been virtually no business cycles in recent years and growth rates have barely fluctuated. The deep downturn in the Chinese economy in 2015/2016 can hardly be read from the official figures. The state has hardly published any corrections to initial growth estimates since 2012. Portfolio manager Yanjun Gast from LBBW interjects, however, that the trend is correct and that the fundamentals of the economy are good. German companies also reported good developments on the Chinese market.

Shortly before her death, investor Beate Sander emphasized that things are not looking up in all sectors in China. In contrast to Germany and the EU, the Chinese government has so far only started comparatively cautious economic stimulus programs. At times it looked as if the US and China would end the trade war by reducing punitive tariffs for the benefit of both nations. But since the Corona crash in spring 2020 there has been no sign of a relaxed climate. The stock market legend was firmly convinced that China would triumph in the conflict with the United States. Therefore, it also increasingly relied on Chinese stocks.

China stocks: A, B and H shares

What makes the Chinese stock market so special? Unlike in other regions of the world, special share classes stand out in China: A, B and H shares, as well as red chips and P chips, S chips and N shares. In principle, however, there are among them two large segments: A and H shares. The rest can be understood as belonging groups.

  • A shares are listed in Renminbi (Yuan) on the Shanghai or Shenzhen stock exchanges. Non-Chinese investors are only allowed to invest in A-shares if they are selected institutional investors (Qualified Foreign Institutional Investors - QFII). This is why A-Shares are now also included in broad indices. (Although the Chinese currency is linked to an international currency basket, it is not freely convertible. The exchange rate is set by the central bank.)
  • B shares are Chinese stocks that are traded in foreign currency, also listed in Shanghai (mostly US dollars) or Shenzhen (mostly Hong Kong dollars). This segment was created for foreigners. With the easing of the restrictions on A-shares, however, this share class has lost importance

A and B shares are part of the OnshoreSegment, the so-called mainland stocks. Now they follow Offshore-Classes. They are fully accessible to foreign investors.

  • H shares are Chinese stocks that are traded in Hong Kong dollars in Hong Kong. (The companies are often also listed as A shares, but usually with a premium to a different rate.) As a liquid market, the segment is popular with large investors.
  • Red chips traded in Hong Kong but controlled by companies or organizations belonging to the People's Republic of China.
  • P chips are companies based outside of China. However, they make sales in China, have an ownership structure there or concentrate their property in the country.
  • S chips belong to Chinese companies whose shares are listed as S Shares in Singapore. The companies operate in mainland China.
  • N shares are shares of Chinese companies that are listed in New York, such as the NASDAQ. They are basically the US-American P-Chips. They have their main business in China and are often traded as ADRs (depository receipts, representing the original stock) in New York.

Chief investment strategist Stephan ventures an outlook: "In the coming years, A-Shares could benefit from a progressive integration into the global stock indices of MSCI and FTSE Russell." Chinese Festlan shares are still heavily underrepresented here, even though the A-Shares share market is the second largest share market after the USA.

In which China index are the share classes traded?

There are a number of Chinese stock indices. The are particularly popular CSI 300 (Mainland) and in Hong Kong the Hang Seng Index and the Hang Seng China Enterprise Index.

  • The CSI 300 has the number of his titles in its name. The index contains the 300 largest and most liquid companies that are listed in Renminbi and traded in Shanghai or Shenzhen (A shares). There are two (savings plan) ETFs from Xtrackers on this index.
  • The Hang Seng China Enterprise Index (HSCEI) contains the top 50 H-shares of (mainland) Chinese companies traded in Hong Kong. There are two (savings plan) ETFs on this index, from Lyxor and ComStage.
  • The Hang Seng (HSI) contains the 50 largest and most liquid companies (blue chips) listed in Hong Kong. There are two (savings plan) ETFs on this index, from Lyxor and ComStage.

Uwe Sander favors this Chinese index

Which China index does Uwe Sander highlight in particular? "The Hang Seng Index from Hong Kong provides a good overview. It tracks the share prices of the 50 largest companies traded there, including financial and Internet service providers. The so-called H shares are traded in Hong Kong dollars and are also free for private investors tradable. The importance of the HSI will continue to grow if shares in Chinese companies actually have to leave the Nasdaq. "

MSCI China

The MSCI and FTSE indices are popular for German investors. With regard to China, there are a number of indices from these providers:

  • The MSCI China contains a good 700 values. They are the largest and best-selling Chinese companies on the Hong Kong Stock Exchange (H-Shares, B-Shares, Red Chips, P Chips).
  • The MSCI China A also contains a good 700 stocks, but only A-shares, as the name suggests. These are the largest and best-selling companies that are traded in Renminbi in Shanghai or Shenzhen.
  • The MSCI China A Inclusion contains almost 500 A-shares, which also appear in the MSCI Emerging Markets (emerging countries world).
  • The MSCI China A International contains good A shares. These are the largest and best-selling companies that are traded in Renminbi in Shanghai or Shenzhen. The index offers A shares for selected institutional investors (QFII).
  • The MSCI China H. contains almost 90 H shares. They are the largest and top-selling companies listed in Hong Kong.

FTSE China

When it comes to the FTSE indices, the first one catches the eye in particular:

  • The FTSE China 30/18 Capped contains 980 large and medium capitalization stocks, namely A, B and H shares, P chips, red chips, S chips and N shares. The numbers in the name mean: The largest company is capped at 30 percent of the index, all others at 18 percent.
  • The FTSE China 50 contains 50 Chinese stocks, the largest and most liquid listed in Hong Kong: H-Shares, Red Chips and P Chips.
  • The FTSE China A-H 50 contains the 50 largest Chinese companies listed in Shanghai or Shenzhen, represented by their A or H shares.
  • The FTSE China A 50 contains the 50 largest A-shares that are listed in Shanghai or Shenzhen in local currency.

S&P China 500

There are three more China indices:

  • The S&P China 500 contains the 500 largest and most liquid Chinese stocks in all segments including A-Shares and Offshore classes. There is a (savings plan) ETF from WisdomTree on this index.
  • The Dow Jones China Offshore 50 contains the 50 largest companies that mainly operate in mainland China but trade in Hong Kong or the US. There is a (savings plan) ETF from iShares on this index.
  • The Shanghai Stock Exchange 50 A-Share contains the 50 largest A-Shares traded in Shanghai. There is an ETF (suitable for savings plan) on this index, managed by Lyxor (Bank of China International (BOCI) Commerzbank).

In December 2020, MSCI, FTSE Russell and S&P Global deleted a total of a good 30 Chinese stocks from their indices, according to the requirements of the Trump administration. Accordingly, American investments were no longer allowed in companies that belonged to the Chinese military or are controlled by it. The weighting of the deleted companies was very low in the indices, especially in the MSCI Emerging Markets. Uwe Sander also underlines this. "However, the new US administration has not yet changed course and I can only hope that China and the US will now negotiate in a dialogue with one another without entering into a competition over trade restrictions."

Hang Seng Tech

A new index was launched on the Hong Kong Stock Exchange on July 26, 2020: the Hang Seng Tech. A consequence of the conflict between China and the USA. Because the United States had made Chinese IPOs difficult in the months before.The mounting tension caused some Chinese companies, at least in part, to return to Hong Kong from the New York Stock Exchange: such as the tech companies Netease, and Alibaba.

Most recently, Donald Trump said he was also looking into a ban on Alibaba in the United States. Yanjun Gast from LBBW Asset Management explains that the US is not Alibaba's core market. For them, the trade conflict is one of the more short-term risks to sentiment because the fundamental data are intact.

The Hang Seng Tech Index brings together the thirty largest technology companies listed in Hong Kong. These include the large Chinese tech companies such as Alibaba, Tencent and Xiaomi. For Yanjun Gast, these companies are the best companies in the field with the greatest potential. The index spans several areas of the technology sector: hardware, insurance, cloud computing, fintech and e-commerce. The five largest positions make up more than 40 percent of the weighting:

  • Alibaba (Amazon rival)
  • Meituan Dianping (service broker)
  • Xiaomi (Huawei competitor)
  • Tencent (Internet with messenger services, social networks and online media)
  • Sunny Optical (lens manufacturer for smartphones)

The Ant Group would also have been a candidate for Hang Seng Tech. The tech heavyweight should actually have gone public in China at the end of October 2020. It would have been the largest IPO in the world to date. However, the state stock exchange in Shanghai canceled the fintech's IPO. The decision of the Chinese regulators is linked to the split relationship between Alibaba founder Jack Ma and the Chinese leadership, who says: "My philosophy is to love the government - but not to marry it." Success on the stock market in China is impossible without the support of the state.

Focus on Chinese health stocks

Deutsche Bank's chief investment strategist, Dr. Ulrich Stephan, advises investors to keep an eye on China's health sector. "Since 1978, health spending in China has risen by an average of 17 percent per year. In 2017, spending per inhabitant was 841 US dollars, but still far below that in Germany (5,922 US dollars) or the USA (10,246 US dollars) . I expect spending in China to continue to rise in the years to come due to increasing affluence and an aging population. " Already almost 170 million Chinese are over 65 years of age, and an increase to 200 million is expected over the next five years. "Since the state health system only guarantees basic care, I expect an increasing demand for private health insurance," added Stephan.

Professional investors in China rely on the same areas as in the rest of the world: technology, health, industry and consumption. Stock exchange professional Uwe Sander assumes the potential in the technology and health sector is known to be huge. As Dr. Stephan refers to the transformation process in the health sector: "In contrast to the US, 95 percent of citizens have basic insurance. Since the Chinese government has a positive attitude towards digitization, with relaxed rules for telemedicine, opportunities for digitization are being used in rural areas Point, China is more advanced than many European countries. " With its 1.4 billion people, China is also developing dynamically in terms of consumption. A growing middle class is discovering the desire to consume. In this sector there is a freedom of choice that does not exist in other areas of life.

The largest ETFs on China stocks

If you have chosen China as your investment destination, then ETFs have the advantage of diversification and low costs by relying on broad indices. In addition to the indices listed here, ETFs on emerging market indices, where China is strongly represented (up to 80 percent), can also be considered. In the Asia region, too, China is still included with a weighting of up to 56 percent.

The largest tradable ETFs on China stocks in Germany are currently the iShares MSCI China A and the Xtrackers MSCI China, each with a volume of a good two billion euros. The twelve-month performance is around 30 percent. The cheapest ETF (0.19 percent running costs) is the Franklin FTSE China on the widely diversified FTSE China 30/18 Capped with a twelve-month performance of a good 30 percent. The fund volume is around 90 million euros.

China for Sustainable Investors?

For investors who want to pay attention to sustainable investments, things could get more difficult in China: On the one hand, China was the world's largest emitter of carbon dioxide with 28 percent of global CO2 emissions in 2018. Working conditions and human rights in the People's Republic are another critical issue. Well-known entrepreneurs who are inclined to the West disappear from the scene from one day to the next, such as Alibaba founder Jack Ma. He was missing from the end of October 2020 to the end of January 2021. In October, he criticized the Chinese regulatory authorities in a speech in Shanghai. Shortly afterwards, the IPO of the Alibaba subsidiary Ant Financial was canceled. So should one even invest in China from the point of view of sustainability?

Uwe Sander differentiates when it comes to China investments from an ethical point of view. Regarding environmental policy, he refers to a statement made by President Xi Jinping at the end of 2020: "Our goal is that carbon dioxide emissions will peak before 2030 and that we will be CO2-neutral before 2060." That is not very ambitious, but an important start. In terms of per capita consumption, the Asians ranked well behind the USA or Germany, but with around eight tonnes per capita, it was above the EU average of seven tonnes. And in the field of renewable energy, the Chinese state is investing more than Japan, the USA and the European Union put together. However, Sander states: "The political situation is still difficult. China must be counted among the authoritarian states, the human rights situation is still very worrying, there is nothing to gloss over."

In economic terms, Uwe Sander rates China as quite stable compared to other emerging markets. He did not give up hope that economic liberalization would eventually have an impact on the political arena. Economic cooperation and globally networked investment would certainly support this process, but political improvements would take a long time.

Just a sustainable ETF on China stocks

There is currently only one ETF that invests according to ESG criteria (Environment, Social, Governance): the UBS MSCI China ESG. The twelve-month performance is a good 30 percent. However, the annual costs are relatively high at 0.65 percent, and it is still quite young (launched in July 2019), with a volume of around 100 million euros. The largest stocks in the ETF are Meituan, Tencent and Alibaba.

Uwe Sander generally recommends ETFs for investments of less than 10,000 euros. In China, in particular, sustainable stocks are still valued, some of which are still rated comparatively low compared to stocks from North America and Europe, which have now become hot. Sander finds the sustainable China ETF from UBS highly recommended, despite the relatively high fees. Below are a few examples of sustainable individual shares that Uwe Sander has in his portfolio.

Uwe Sanders China favorites

The following values ​​can be found in Beate and Uwe Sander's book "The best stocks are not found in the Dax", which will be published in April. The values ​​come from Uwe Sander's portfolio of Chinese companies. He says: "The stocks contained in it are all still recommendable. Only with Xiaomi would I be a bit cautious at the moment and leave them on the watchlist." Xiaomi, as a value listed in New York, could become a subject of dispute between the USA and China: "It will be exciting to see how things will go with Xiaomi. The new US government will focus more on dialogue on foreign policy, but the conflicts with China will be difficult to be solved. "

  • BAIDU (WKN: A0F5DE) - Online operator, search engine
  • BYD Electronic (NYSE: BYD) - components for cell phones
  • (NYSE: JD) - online mail order company
  • LENOVO (NYSE: LENOVO) - the world's second largest PC supplier
  • NIO (NYSE: NIO) - electric cars
  • XIAOMI (NASDAQOTH: Electronics): Smartphones and SmartHome

The depot also contains Alibaba, BYD, Geely Auto and Tencent.

A video and a dating app are Uwe Sander's latest investments. The video app Kuaishou went public on February 5, 2021. The stock tripled that day. Uwe Sander also benefited from it: "My last two investments in China, besides Kuaishou, were the Chinese dating app MOMO Inc. The share had performed negatively in 2020 and did not bottom out until the end of the year. Since then, the 'Chinese Tinder' has been back in an upward trend. "

Sustainable shares from Uwe Sanders Depot

The following sustainable stocks also come from Uwe Sanders Depot. He points out that every investor is responsible for his own investment and shares can lead to losses. It is important to pay attention to a broad diversification of industries, company sizes and regions. In any case, there is hardly a way around China in the long term.

  • BYD (WKN A0M4W9): "This huge conglomerate with the illustrious name" build your dreams "and its approximately 230,000 employees offers pretty much everything that has to do with electromobility, from batteries to large battery storage systems to electric buses the company in other fields of environmental technology, such as. solar farms. "
  • GEELY Auto (WKN A0CACX): "The large automobile manufacturer is increasingly relying on electric drives. The Geometry brand currently offers several all-electric models."
  • NIO (NASDAQ: NIO): "The electric car manufacturer would have gone bankrupt in 2020, survived and started its impressive stock market rally with a price increase of a staggering 1,000 percent in one year."

There is no market without risks - Chinese stock flops

As Ray Dalio notes, every market has its risks. But general risks also have an impact in China, as elsewhere. Keyword: Luckin Coffee. The coffee and coffee house chain, which was only founded in Beijing in 2017, quickly enjoyed success as a kind of "Chinese Starbucks", with more branches in China than its American competitor in January 2020. From now on, some things are reminiscent of the Wirecard scandal: at the end of January 2020, Twitter published a report that Luckin Coffee had falsified financial and operational figures. The company denied everything, speaking of malicious and false allegations.

In early April 2020, Luckin Coffe announced that a senior executive had faked sales of around RMB 2.2 billion ($ 3,339 million). The Chinese financial regulator said they are investigating fraud. Luckin Coffee's price plummeted 80 percent. Trading was suspended in the US and Europe on April 8, 2020. The share has been trading again since May 20, 2020.

In China it must be taken into account that the government has a strong influence on companies, regulating and restricting them. The same applies to their influence on stock market trading. China, however, will have to face growing competition from the outside world, especially with India, which is growing faster than China. (Here, too, China's influence on its currency is evident. In this competition, the government often tries to devalue the renminbi.)

For private investors, the arbitrariness of the Chinese government is a risk that is difficult to assess. Another danger could be the formation of a housing bubble, as in the case of the subprime crisis in the USA. Many households in China are heavily indebted because banks have provided cheap loans for years. Should one of these banks fail, Chinese stocks face a nasty scenario, similar to what happened after the failure of Lehman Brothers.

The Chinese state is always at the table

Again, investing in Chinese stocks or funds / ETFs is linked to the state of China and its government. For example, some Tencent board members are government officials. If Tencent collects data on the Chinese population, it is automatically forwarded to the government. This is another reason why it is in the interests of the state to see Tencent or Alibaba flourish.

The strong role of the government in Beijing also gives rise to risks, emphasizes chief investment strategist Stephan: "For the prices of companies listed in Hong Kong, the greatest danger is currently from the political tensions between the Chinese central government and the citizens of the Special Administrative Region." In the onshore segment, the dangers lie elsewhere: "Mainland stocks tend to react more to headlines than stocks traded in Hong Kong. One of the reasons for this is the high proportion of Chinese private investors who buy mainland stocks for more than 80 percent of the day Trading volume are responsible. "

80 percent of the A shares are in the hands of private investors. This is considered to be the reason that mainland Chinese stocks are volatile, also compared to other emerging markets. Uwe Sander emphasizes, however, that A shares are not a suitable investment object for gamblers, hedge funds or short sellers. The size and economic strength of the companies behind the shares usually do not allow this. “Right now, I don't think most stocks from China are overvalued. Otherwise, whatever applies to the stock market: Without risk, there is no chance of returns and: If you don't invest in China, you will miss out on a lot of opportunities. "

Investing in China's structural drivers

As an investor, however, you are not completely defenseless against political risks. Keyword: structural drivers in China. Kai-Kong Chay, the portfolio manager from Hong Kong, focuses primarily on structural trends because it is often difficult to predict things like the relationship between China and the US precisely: "Thematically, two trends stand out: consumption and innovation." The growing and wealthier Chinese middle class is becoming more and more mature in terms of consumption. The higher disposable income (52 percent increase over the last five years) is more likely to flow into services in areas such as education and leisure than into clothing, food or tobacco, for example.

Kai-Kong Chay: "Consumers want better quality services than those of the state, which opens up new opportunities for private providers. For example, online education has experienced an upswing - not least as a result of the lockdown." Students would now have access to more teaching resources, especially in smaller cities. "The Covid-19 situation has also changed the way people consume. The share of e-commerce is increasing sharply. We are optimistic about e-commerce, especially for emerging companies whose offerings are aimed at people judge away from the metropolises. "

Despite all the risks, the strong growth of the Chinese market remains to be seen, which has just become apparent in the global corona crisis. China's sustained recovery from the Covid-19 epidemic was and is the basis for an impressive bull market. However, Yanjun Gast from LBBW Asset Management also emphasizes that they last saw a crazy bull who couldn't run far. In other words: the fundamental data are good, but the valuation has strayed too far from it. A possible correction in sentiment and share prices can be used well as an investor to get started.

Conclusion: The best way to counter the risks on the Chinese stock market is with perseverance and long-term investments. Exchange rate fluctuations or market interventions by the state are easier to endure and endure. Perseverance has been rewarded in the past.

Article sources

The sources used in the article come primarily from primary sources such as studies, analyzes, federal statistics, business reports or interviews with industry experts. If necessary, we also refer to original research by other reputable publishers. In our Editorial Guidelines you can find out more about the criteria we adhere to when creating accurate and unbiased content.

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