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Post by anitya on May 29, 2021 4:42:13 GMT
Any company that does not have CCP as a controlling shareholder will get knocked back the first time CCP feels the company could become a threat to its existence. It does not have to be anything the company does, other than being more popular with the citizens. Remember, the CCP also appoints its own Catholic bishops and Buddhist lamas. We should check if a Chinese mid cap fund would cure the “good economy bad stock market” problem better.
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Post by Norbert on May 29, 2021 6:07:02 GMT
changMy take us that many Asia / Chinese funds, particularly the growthier stuff, are simply correcting or resting after a stellar 2020. Matthews China Dividend (MCDFX) is doing fine this year, after a relatively slow 2020. It's the same story for SCHD and FISMX. So, I think we're mostly seeing a technical rotation story, not anything fundamental. As for the future, I'll need to get back to you later. FWIW, N.
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Post by steadyeddy on May 29, 2021 13:48:56 GMT
How many of you are INCREASING your allocation to China? (I know Chang's answer).
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Post by rhythmmethod on May 29, 2021 15:55:44 GMT
Good time to revive this topic. Yeah, the drama never seems to slow up lately. I still believe that at some point in the future China basically owns the world, and that a China overweight in my investments makes sense. Whether or not Chinese stocks are the place to be in 2021 or 2022, of course, is a different question. Bold above is BINGO, IMO. I have yet to see another culture with a work ethic and discipline that I have witnessed in China. Creativity and individual thinking, not so much. Still, betting against China in the long term is like betting against Elon Musk. One might be right, but I doubt it. So, what to do? I've already cashed some of my MATFX for a very nice profit. I sure didn't hit it at the very top, however. I'm going to hold on to what I have for a while and when bored throw a few $$ at it on downturns. I've concluded, for me, a dividend China fund doesn't make sense. I'd rather cast a wide net with VGWAX. If I'm going to play the China game, I'm going for growth. I'm tempted to also add to VWILX on other downturns. I noticed it was one of my best performers yesterday. Whether a China specific fund is the answer or an international fund with a China-centric manager fits my needs better is still TBD. I must admit that whenever I start to see headlines against ANYTHING I consider that a potential buying op. That is probably my cantankerous, against the grain nature. I'll be posting on the BSW thread any decisions on China. Thanks for weighing in.
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Post by retiredat48 on May 29, 2021 22:23:11 GMT
There never is an end to "China Drama" it seems. In the past it has proven a reason to BTD. I'm kind of leaning to reallocate now, however. The reason has more to do my my desire to simplify rather than squeeze the best TR. Thus, I'm considering slowly dissolving my MATFX (I've made a pile of $ with it) and reallocating to VWILX (and others) where a good manager can decide howe much China to hold. This is along my thinking with HC specific funds as well. What do others think about China going forward? The basic long term narrative is a net positive for China, IMO. I'm re-thinking how much drama is within my current tolerance. chang , what are your thoughts? Good time to revive this topic. Yeah, the drama never seems to slow up lately. I still believe that at some point in the future China basically owns the world, and that a China overweight in my investments makes sense. Whether or not Chinese stocks are the place to be in 2021 or 2022, of course, is a different question. China does face a few headwinds. The various political dramas may or may not directly affect the profitability of Chinese companies, but perception matters. Nobody ever said the stock market was logical. If investors sell and flee, then prices will drop, regardless of whether or not it's logical. It is possible that the US may ramp up its delisting efforts regarding Chinese shares that trade on US exchanges. China may mishandle the rise of cryptocurrencies. There's a variety of potential obstacles in the road ahead for China. I've got funds like MIAPX and MITEX in [unfortunately] taxable accounts, sitting on ~50% CGs, and I think it would be foolish for me to sell them. However, as most Foreign and especially EM funds have big China concentrations, I am not as warm to individual China funds as I was a while back. My newest buy in this arena was FHKCX (in an IRA) with shares purchased between 12/2020 and 02/2021 (ten purchases): the first five purchases are in the green, and then last five are in the red (I can hear R48 saying "You were on the right track... then what happened to you?!"). The entire position is currently sitting at +0.71%. A distinct failure, I have to say. In contrast, I bought FISMX five times between 12/2020 and 05/2021 (every purchase in the green; R48: "Attaboy!") and it's up 15.4%. I may be better off ending the FHKCX experiment for now. It's a fairly sizable position, but I'm still well over-weighted with other foreign and EM funds. I own FEMKX in the same IRA (31% China), which might be a better place for that money right now. I will give this some thought next week. I wonder what Ray Dalio is doing with his China investments now. I don't get it? What's the rush away from China, and out of some of these funds, for?? Norbert says my viewpoint as well...simply a correction. Look at the charts for these various funds discussed. Great run-ups well past the pre-covid highs; almost asymptotic. Then since Feb, a moderate selloff--likely a correction. Technically, these funds may be ready to go up again. Note Chang your FHKCX price almost sat on its 200 day Moving Average, and then moved upward. A strong sign. To me, the real long run concern with China is your (Chang) statement here: " I still believe that at some point in the future China basically owns the world,...". The risk is they will own more than that...they simply nationalize or find a way to take all of everyone's fund holdings. The political risk aspect. Like Jack Ma currently. Why should China let USA people in on their prosperity?? R48
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Post by chang on May 29, 2021 22:50:02 GMT
I see the 200mda on the chart now R48 ... yes I agree that looks promising if it holds. Edit: similar story for FEMKX. Link
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Deleted
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Post by Deleted on May 29, 2021 22:50:37 GMT
I added to my BABA position, but the position is half of what I would normally hold. It’s risky. High reward. That’s it.
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Post by chang on May 29, 2021 22:58:53 GMT
As an aside, for those interested in specific funds to obtain the exposure they want, I picked FHKCX largely because it is blendier than most of the other China / Asia / EM funds. Compare its P/E, P/E, etc. to FSEAX and FEMKX, for example. So, the recent growth-led drawdown could have been worse.
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Post by fishingrod on May 30, 2021 1:11:53 GMT
I am hopeful for the relations with China but, I fear that the Entities may take away a good bit of our recent gains, again. I am holding firm in my position with VWILX, Vanguard's Int'l Growth fund. In 2016 I exchanged all my Total Int'l Index fund VTIAX and bought more VWILX. It has exceeded my expectations with a return of more than 150%. I like chang , have some large tax handcuffs which restrict motion. Fishingrod
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Post by anitya on May 30, 2021 4:56:34 GMT
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Post by rhythmmethod on Jun 1, 2021 22:54:01 GMT
I swear every time I mention something about China Drama and how MATFX is doing poorly, it pops the next day. It's like a Facebook ad. Crazy. Up 2.69% on an otherwise dull day. I'll be sure to bump this post every time it falls back.
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Post by retiredat48 on Jun 2, 2021 0:21:26 GMT
I swear every time I mention something about China Drama and how MATFX is doing poorly, it pops the next day. It's like a Facebook ad. Crazy. Up 2.69% on an otherwise dull day. I'll be sure to bump this post every time it falls back. Ha...a good Plan B, rm.
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Post by chang on Jun 2, 2021 0:45:19 GMT
I swear every time I mention something about China Drama and how MATFX is doing poorly, it pops the next day. It's like a Facebook ad. Crazy. Up 2.69% on an otherwise dull day. I'll be sure to bump this post every time it falls back. All my EM and China-centric funds rocked today. Post all you want about it.
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galeno
Commander
KISS & STC
Posts: 221
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Post by galeno on Jun 11, 2021 23:19:12 GMT
China's great! China's terrible! USA's great! USA's terrible! It's far too bipolar for this old Latino.
We hold the Boglehead "global haystack" and let our FTSE all world equity index UCITS ETF (VWRD) allocate our equity holdings as per all the different countries in it.
#1. USA allocation is 57.2%. #2. Japan 6.8%. #3. China 4.7%. Rest of the world 31.3%
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Post by chang on Sept 1, 2021 0:42:16 GMT
China and EM saved my bacon today. Just goes to show that diversification has its advantages.
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Post by rhythmmethod on Sept 1, 2021 1:48:35 GMT
Long-term China owns the world. Question is how much will they share the proceeds? BABA rocked today, BTW.
edit to add - I'm not un-American, just pragmatic. Work ethic, focus, etc. China rules. See earlier post about China restricting the use of video games. Have they started offering a video game degree yet at US Liberal Arts colleges?
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Post by bb2 on Sept 1, 2021 2:05:31 GMT
China = BTC = Fingers crossed = speculative right now. Unless someone can explain why BABA is down 50% and why that's ok, I'm waiting. Down 50% is tempting.
2.9% ain't rocking after down 50. Sorry; not in a good mood.
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Post by chang on Sept 1, 2021 2:16:21 GMT
Long-term China owns the world. Question is how much will they share the proceeds? BABA rocked today, BTW. Big jumps (5-10%) from BILI, Tencent and Meituan today lifted a lot of boats. The really surprising thing is that I merely mentioned on Sunday that I would consider trimming equity this week. Haven't done anything. The market usually plans its big surges to occur right after I actually sell.
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Post by richardsok on Sept 1, 2021 2:30:00 GMT
IHD has a 35% exposure to large cap China stocks and is priced at 7% discount. 10/1 it hits its quarterly ex div. Might be a good entry point if you don't require full China exposure. Its technicals are positive, as chart is recovering from lows after a serious slide. I recently bought a position.
FWIW.
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Post by rhythmmethod on Sept 1, 2021 3:56:49 GMT
China = BTC = Fingers crossed = speculative right now. Unless someone can explain why BABA is down 50% and why that's ok, I'm waiting. Down 50% is tempting. 2.9% ain't rocking after down 50. Sorry; not in a good mood. Depends on when one bought it. Sure it's speculative. It's that risk - reward thing. But I'm not betting more than I can afford to lose. It's only money.
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Deleted
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Post by Deleted on Sept 1, 2021 11:03:36 GMT
I like to think of the political situation in China as speculative, not Alibaba. BABA is a great company. China is still the second largest economy in a global era. It's down in price because the recent political situation - a black swan event. At the end of the day they want a profitable economy which we know is primarily driven by the consumer.
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Post by bb2 on Sept 1, 2021 14:50:54 GMT
Just saw a guy interviewed on CNBC who said the recent regulating could have been anticipated if we'd have been paying attention over the last couple years. He also thinks we are close to the end or what the new playing field will look like. At least for a while. I'm going to go back (BABA transcripts, for example), and see if I can find out what he's talking about. And it looks like the market is in. All big China is up 5% or more today. I'm in too, just a bit, like slooow. I'm finding China very interesting, not just from an investment POV. This, from a review of "How China Escaped Shock Therapy: The Market Reform Debate", by Isabella M. Weber: bostonreview.net/class-inequality/macabe-keliher-china-and-lure-global-capitalism"Similarly, peasants were decollectivized in 1982, often against their will, creating vast inequalities as they were atomized and left to struggle on the cyclical waves of the market and suffer deprivations by local officials. Rather than empowering people to shape the economy through alternative institutions such as peasant-run cooperatives, worker-controlled factories, and independent labor unions and community organizations, leaders subordinated workers and peasants to the totalizing goal of (economic) growth. Although GDP rose and wages increased, inequality has soared, working conditions have deteriorated, millions have been thrown out of work or lost their land, and industrial pollution and environmental degradation have destroyed communities and left countless dead. China’s leaders may have escaped shock therapy (neoclassicist economic liberalization), but in the course of doing so they have exposed the nation to the brutal logic of capitalism." The CPP I think really does care about the people, not so much foreign investors, so the situation will always have to be watched closely. Sometimes their interests line up.
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Post by bb2 on Sept 1, 2021 19:24:32 GMT
Talk about drama: www.forbes.com/sites/georgecalhoun/2021/06/24/what-really-happened-to-jack-ma/?sh=37169cf47c7e"Imagine a hypothetical parallel. We know that Amazon, for example, is under pressure from the US government for potential antitrust violations. Suppose that in the course of this process, Jeff Bezos were summoned to Washington, and suddenly disappeared — not to be seen in public for nine months, his whereabouts unknown. We can imagine that there would be a media uproar. " BTW, not seeing much warning in BABA annuals. Boilerplate risks. But interesting stuff on the dependency on ANT. "We rely on Alipay to conduct substantially all of the payment processing and all of the escrow services on our marketplaces. If Alipay’s services are limited, restricted, curtailed or degraded in any way, or become unavailable to us or our users for any reason, our business may be materially and adversely affected." Lots more about ANT and regulation but nothing specific, so I think you'd have to really know China to figure this stuff out. Also, Ma, through ANT, controls BABA, despite owning only 5%. corpgov.law.harvard.edu/2020/08/11/alibaba-a-case-study-of-synthetic-control/
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galeno
Commander
KISS & STC
Posts: 221
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Post by galeno on Sept 1, 2021 20:39:30 GMT
We hold 4% Chinese domiciled equities in our 50% equity allocation. And 58% USA domiciled.
My take.
The USA has GREAT geography and demographics. China's geography and demographics could't be more HORRIBLE.
China NEEDS the USA. The USA does NOT need China. It LIKES Chinese prices. It LOVES that the pollution externalities also stay in China.
The US Navy is ESSENTIAL to China's EXPORT economy. China's Trade/ GDP = 35%. USA's = 12%.
All the USA has to do to make China fall apart is to bring home the Pacific fleet.
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Post by bb2 on Sept 2, 2021 20:10:37 GMT
Hey galeno, could you say more about this : "The US Navy is ESSENTIAL to China's EXPORT economy." And I guess this too: "All the USA has to do to make China fall apart is to bring home the Pacific fleet."
I've been googling and I can't figure out what you mean. Thanks.
BTW, I'm out of BABA. 1 day after buying.
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Post by jongaltiii on Sept 2, 2021 21:54:03 GMT
The Forbes story on Ma is alarming. The major funds are selling BABA in large quantities (right?). Now how does that square with Munger’s purchase in June? And just when you think you have it all figured out, they reduce kids gaming time and now this… They ban sissy men. Hmmm… maybe they have a long term plan. I just don’t know how it will benefit Joe investor. news.yahoo.com/chinese-communist-party-bans-sissy-160600881.html
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galeno
Commander
KISS & STC
Posts: 221
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Post by galeno on Sept 2, 2021 22:54:19 GMT
The reason China (and every other country in the world...friend or foe) can export their products to other countries is because the USN allows it. USA is the GLOBAL coast guard of all the oceans and important seas. China is surrounded on both land an sea by MANY powerful ENEMIES. E.g. Japan's navy would humiliate China's navy inside a week. Vietnam's army could probably beat China's army today. Hey galeno, could you say more about this : "The US Navy is ESSENTIAL to China's EXPORT economy." And I guess this too: "All the USA has to do to make China fall apart is to bring home the Pacific fleet." I've been googling and I can't figure out what you mean. Thanks. BTW, I'm out of BABA. 1 day after buying.
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Deleted
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Post by Deleted on Sept 2, 2021 23:31:53 GMT
Banning sissy men sounds like a good idea. Some of the women in my wife's group no longer watch S. Korean movies and TV serials because men in them are too sissy. btw I heard S. Korea makes good tv and movies.
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Post by yogibearbull on Sept 3, 2021 14:25:01 GMT
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Deleted
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Post by Deleted on Sept 3, 2021 14:36:19 GMT
I saw the "donation." I don't see this as surprising and would think the government already had this baked in. It is a communist country after all. Maybe they can get on with business now. TBD.
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