ap english language and composition essays
how to write custom workflow in crm 2015
objective for resume in customer service
different types of essay
how to write an anatomy lab report
writing a application letter for a job
growing together in grace essay
professional resume writer rochester ny newspaper
help with skill base resume
customer service and billing resume
essay on my doll house
masters thesis action research
acknowledgement phd thesis
great sales associate resume
android pause resume service
cover letter in sales delivery
dmcc business plan
professional excellence summary resume sales
resume for nutrition service associte
essay on buddhism
telecom channel sales resume
dissertation report green marketing
child gets angry doing homework
macbeth essay questions
black history essay
how to write an application essay 8th grade level
vp sales resume summary
evaluation paper
research paper about diabetes
rhetorical analysis essay outline
essential calculus early transcendentals homework help
helping spelling homework
descriptive essay about an unforgettable person
paper presentation on operating system
persuasive essay on adoption
science homework help electricity
scanrouter v2 resume services
paid article writing
service operation management essay
automobile salesman resume
sales executive objective for resume
phd thesis on fuzzy logic
thesis custom body background
write customer service resume objectives fast
dissertation research proposal methodology section
persuasive essay attention getter
career change sales cover letter
texting and driving research paper
cover letter for retail sales no experience
customer service thesis
pharmaceutical sales cover letter resume
dissertation proposal powerpoint presentation
resume jewelry sales representative
panic disorder thesis
student discipline essay
solar system essay
write essay on my holiday
fraction decimal homework help
research paper on customer relationship management pdf
paid master thesis in sweden
dissertation interview consent forms
resume for custom home builder
resume guest services agent
resume help substitute teacher
charles lamb a dissertation upon roast pig analysis
essay about environment 300 words
how to use footnotes in an essay
professional cv writing johannesburg
favorite place essay
an essay about drugs
special events sales manager resume
getting old essay
volunteer customer service cover letter
help on dissertation 4g technology
essay translation service
business banking sales resume
teacher cover letter help
so many countries so many customs essay
how to hire a ghostwriter
additional coursework on resume you put
motivation essay
resume for entry level pharmaceutical sales
genetically modified foods research papers
essays on childhood obesity
dissertation report on performance management system
research paper about gandhi
writing prompts for esl students
maid to order essay
senior service project essay
a2 pe coursework help
american dream essay
master paprers com
fail master thesis defense
service clerk resume
master thesis in finance themes
argumentative essay about environmental issues
my american dream essay
customs broker resume
dissertation about islamic banking
the picture of dorian gray essay
research papers in nursing
dissertation on fashion and architecture
help on writing essay describing a person
essay helping disaster victims
bilingual customer service cover letter
sacred heart community service homework club
essay about romeo and juliet
resume wine sales representative
resume assistant buyer position
doctoral dissertation herb spice as antimicrobial
attention getters for an essay about yourself
write good essay english about myself
writing college admissions essay journalism
insurance agent resume sales professional
anne frank essay
standard and scientific notation homework help
professional resume service spring tx
essay improvement service
professional cv writing services kenya
design phd thesis
essay on future of electronic gadgets
dissertation in in linguistics optimality outstanding reduction theory vowel
essays on goals for the future
romeo and juliet argumentative essay
argumentative essay about poverty
business plan buy existing company
resume general manager sales
vladimir putin phd thesis
how to write an essay about my friend
resume technical writer fresher
custom powerpoint services
little women research paper
essay malaysian customs and traditions
phd life science resume
research paper in english literature
health and human services term paper
robinson crusoe thesis
gay marriage essay thesis
dissertation service in malaysia airlines
writing my admission essay village
surgical service resume
homework help writing a summary
project management term paper
do children learn through play essay
phd in computer science thesis in data mining
research paper on operating system
dissertation defense hints
write narrative speech
transition sentences for essays
professional resume services for bankers
descriptive analysis in dissertation
writing essay my idol
essay about jackie robinson
teacher recommendation letter help
huckleberry finn essays
legalize marijuana research paper
identity theft essay
nike research paper
resume technical sales manager
dissertation statement of originality
service desk consultant resume
pros and cons of school uniforms essay
resume for food service
resume for real estate sales agent
hari balakrishnan phd thesis
jiskha homework help life orientation
personality disorder research paper
gis master thesis
maths personal statement
sales manager hospitality resume
apa style money
homework help factoring rational expressions
junior purchaser resume
football research paper
mri service engineer resume
institutional sales resume
how to write a paper about a movie
resume for saleslady
too much homework essay
human nature essay
master thesis cover sheet
exploring writing paragraphs and essays
chicago style of writing papers
writing term papers anthropology
cover letter for a sales
the importance of being earnest criticism
homework help with word problems
phd thesis fracture mechanics
Top China ADR Portal

China ADR stock research

Warning: strtotime(): It is not safe to rely on the system's timezone settings. You are *required* to use the date.timezone setting or the date_default_timezone_set() function. In case you used any of those methods and you are still getting this warning, you most likely misspelled the timezone identifier. We selected the timezone 'UTC' for now, but please set date.timezone to select your timezone. in /home1/chinaves/public_html/libraries/joomla/utilities/date.php on line 56

Warning: date(): It is not safe to rely on the system's timezone settings. You are *required* to use the date.timezone setting or the date_default_timezone_set() function. In case you used any of those methods and you are still getting this warning, you most likely misspelled the timezone identifier. We selected the timezone 'UTC' for now, but please set date.timezone to select your timezone. in /home1/chinaves/public_html/libraries/joomla/utilities/date.php on line 198

Embrace Volatility for Rest of 2013

E-mail Print PDF

rollercoaster July 2013 (Chinavestor) We argued that high risk had yielded high return in 2013 so far in our last Newsletter, but that is about to change in our view. We are uncertain about the speed of change but the underlying force, e.g. the abundance of easy money, is about to change.

Before examining what we expect going forward, let’s just take a look at the record for June. The Dow Jones Industrial Average (INDEXDJX:.DJI) gave back -1.4% in the month but is still 13.8% up year-to-date (YTD). That is the best first six month performance for the index since 1999!

But Chinese equities and indexes failed to take advantage of such a rally. The Shanghai Composite Index (SHA:000001), measuring the performance of domestic Chinese equities, tumbled -14.0% in June and is down -12.8% YTD.

The Hang Seng Index (INDEXHANGSENG:.HSI), the index of the most liquid blue chips in Hong Kong, fell –7.1% in June and is off –8.2% YTD.


The index US investors with a China spin should be most concerned about, the China ADR Index measuring the performance of Chinese ADRs listed in major US exchanges, fell -2.7% in June and is off –10.0% YTD.

Now the Hang Seng Index and the Shanghai Composite Index are in-line with the China ADR Index for the first time in 2013. All of them are down deep in the red, a sharp contrast to the superb performance of the Dow.

Going forward, one thing is certain: uncertainty is growing. FED Chairman Ben Bernanke indicated that he sees 2014 end for QE3, a major change for the underlying support for the Dow.


To illustrate how much quantitative easing influences stock markets, let’s take a look at the first above. There is a clear correlation between Japan’s commitment to double the monetary base in four years and the performance of the Nikkei 225. The Nikkei is on fire ever since Japan’s plans to enter into a competitive devaluation of its currency started this year. The US dollar strengthened 24.17% against the Yen so far this year while the Nikkei soared twice as much, 51.8% at the same time. The same is true for major US indexes, e.g. the FED’s accommodating policy is primarily responsible for the Dow’s record breaking trend since 2009. See chart below for details.


Another highly visible gauge of the effect of easy money is the gold price chart below. See SPRD Gold Trust (ETF) YTD. Gold futures for August 2013 fell to $1223.70 an ounce representing a loss of 23% for the quarter, the steepest quarterly decline since the start of Comex gold trading in 1975! For one, hedging against inflation is diminishing as the FED curtails the printing machine. But just as importantly, investors shunned gold when little risk in equity markets has earned high return for the past six months.


The big question is what is going to happen when the $85 billion/month bond buying will be over.

For one thing, interest rates will go up. The same week when Mr. Bernanke spelled out the most likely scenario for the tapering off for bond buying, 30-year mortgage rates experiences the steepest one week rise since 1987 and jumped to two-year highs. Investors invested in complex vehicles such as short 20+ year Treasury ETFs (ticker symbol “TBT”) reaped benefits instantly.

Besides a major shift in interest rates, we are of a view that the Dow and all major US indexes will experience a correction. Short index ETFs may come to play but again, such volatile and complex ETFs are not necessarily suitable for average investors.


Volatility is not limited to US equities alone. The Shanghai Composite Index fell over 10% within a short period of time at the end of the month as fears of a major financial meltdown spooked markets. The second chart on this page shows how the index fell from 2,150 to 1,850 before recovering some of the losses. The financial system in China grapples with tight credit markets where prime rate jumped to over 10% for a short period of time. It is still uncertain what long term complications might arise but again, volatility globally is on the rise.

So what’s the best course to take for US investors with a China spin? Let’s take a look at how Chinese ADRs did for the last month.


Other than consumer non-cyclical stocks, all major industry groups fell for the month. Consumer durables, healthcare and technology stocks have been among the best for all of 2013. What gives investors a headache with consumer durables is that the group is represented by small cap stocks with low visibility and little transparency. These are those “don’t touch” stocks we have been warnings investors about for a long time. And just as a reminder how much risk still persists with such stocks, take a look at once prominent advertising company, Focus Media Holding Limited (NASDAQ:FMCN). The stock stopped trading on the NASDAQ late May leaving investors settled with steep losses.

Basic materials, transportation, financial, and energy stocks are those of interest going forward. All these sectors are represented by large cap, relatively liquid quality Chinese stocks that investors may want to give a second look.

Aluminum Corp. of China (NYSE:ACH), China’s largest aluminum maker, fell 20% in June while Alcoa Inc. (NYSE:AA) slid 8.85%. We understand that investors are concerned about slower Chinese economic growth but argue that a 20% decline was an overkill and ACH may bounce back in the next three to six months.

Airliners led the decline for transportation stocks and we see more upside potential then downside risk for the sector going forward. China Southern Airlines (NYSE:ZNH) and China Eastern Airlines (NYSE:CEA) are ripe for a comeback in our view.

Yanzhou Coal (NYSE:YZC) among energy stocks is of interest but we’re less enthusiastic about financials like China Life Insurance (NYSE:LFC) or China Finance Online (NASDAQ:JRJC).

Wish you successful investing,

Blaze Fabry.

If you like us, spread the word to the fellow investors on your favorite Social Bookmarking websites
Reddit! Del.icio.us! Mixx! Free and Open Source Software News Google! Live! Facebook! StumbleUpon! TwitThis Joomla Free PHP


BUY this domain with all its credentials. Chinavestor.com has been added to Google News and Finance since 2008! Huge web traffic upside potential! Website is optimized for Chinese stocks but can easily be tweaked. Contact Seller Here

Check out The Benefits of Getting into Google News!

Free weekly newsletter

Get hot China stock news every Monday