the prices already have lots of political risk built in, ie. BABA went down below IPO prices while earning 10x than they were at IPO, that a shred of good news pump them 50%+ in a day...while still down 70% from ATH.
Many think the same. That’s why their stocks are so cheap. Just like many think energy stocks are not investable couple years back. Ask them now.performance wrote: ↑China is run by a communist party...China isn't investable....it doesn't even believe in capitalism let alone equity markets.
Modelling works by trying to predict the future from past performance patterns given certain KPI. That works for the most part given that the rule of law is followed in order to enforce predictability over the long term. In terms of Chinese stocks, you don't have the rule of law but rather the rule of who makes the laws as we saw with the ANT IPO as well as the forced contribution of $15 billion from BABA to the Chinese government. As these things are really unpredictable and have no prior history, we don't know if they are going to be one-time events or reoccurring ones? You can't model that type of behaviour.Redsanta wrote: ↑ the prices already have lots of political risk built in, ie. BABA went down below IPO prices while earning 10x than they were at IPO, that a shred of good news pump them 50%+ in a day...while still down 70% from ATH.
How many more political risk do you want to add in (ie. delisting risk already built in and way overboard when you look at the regulations criterias)? The market is forward looking and already incorporated all the risks about China you could think of at the moment, unless ofcourse with new information, theres updated modelling.
Being a contrarian is good so please provide your analysis more.
Completely different actually. While both may be considered uninvestable at one time or another, the reasons are vastly different. No one fears that all oil companies across the globe may be required to change their operations overnight or have rules changed on them retroactively - sure it might happen in certain geographies by not everywhere at once. The uninvestable for oil came from the fear of ESG groups coming after investors while the market demand was supposed drop rapidly (most of that narrative coming from those same ESG groups). On the other side, China comes from the real possibility that the entire sector can change overnight as the companies are all subject to the whims of the CCP and the CCP has shown that they are not afraid to have whims. The pure unpredictability is what makes them uninvestable.freemoney118 wrote: ↑ Many think the same. That’s why their stocks are so cheap. Just like many think energy stocks are not investable couple years back. Ask them now.
I think it's ok as far as you invest in Chinese stocks as you do in meme stockscraftsman wrote: ↑ Completely different actually. While both may be considered uninvestable at one time or another, the reasons are vastly different. No one fears that all oil companies across the globe may be required to change their operations overnight or have rules changed on them retroactively - sure it might happen in certain geographies by not everywhere at once. The uninvestable for oil came from the fear of ESG groups coming after investors while the market demand was supposed drop rapidly (most of that narrative coming from those same ESG groups). On the other side, China comes from the real possibility that the entire sector can change overnight as the companies are all subject to the whims of the CCP and the CCP has shown that they are not afraid to have whims. The pure unpredictability is what makes them uninvestable.
You can certainly make money in casino. Chinese stocks is uninvestable, untrable, only gamble-able.craftsman wrote: ↑ Completely different actually. While both may be considered uninvestable at one time or another, the reasons are vastly different. No one fears that all oil companies across the globe may be required to change their operations overnight or have rules changed on them retroactively - sure it might happen in certain geographies by not everywhere at once. The uninvestable for oil came from the fear of ESG groups coming after investors while the market demand was supposed drop rapidly (most of that narrative coming from those same ESG groups). On the other side, China comes from the real possibility that the entire sector can change overnight as the companies are all subject to the whims of the CCP and the CCP has shown that they are not afraid to have whims. The pure unpredictability is what makes them uninvestable.
Can you still make money on Chinese stocks? Yes! Absolutely! But that's more on placing a bet on how things will be going rather than straight investing.
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