John Gaats

International ETFs: The Best and Worst Players This Month

Good observation.

It is hard to understand that FXI decreases by -7.4% when EWH is up. Afterall, the underlyings for both are from HongKong. I wonder how much is difference between our pricing and the NAV.

China: Too Much, Too Fast

I respect your opionion as I respect mine.

For my own investment, I disagree with you on developed country approach. The big picture is that developed world will have 2-3% growth this year. In a funnyway, their stocks reflect that. AZ is a good example. Invest everywhere (including China). Grow very slowly. The problem is, it also falls big if the dow falls big time.

My hope is that we can identify some alphas so that we can make a profit even though the Dow is going to be tough this year. Theoretically, FXI should have very low correlation with DOW. However, I feel FXI is very depressed. Probally artificially. I don't mind peopel's free opinion. I just hope we don't penalize our investment because of wrong labeling.

Again, I respect your opinion. Happy investing!

China: Too Much, Too Fast

I have a contrain view: China, too little, too slow. And I am talking about ways we can invest in China. They are about 56 Chinese ADRs here in New York. And we can invest in HongKong through FXI. Given the trend that Chinais growing at double digits and YUAN is appreciating against the $. We know we need them. Both NYSE and NASDAQ have set office too attract more Chinese firms to the Big Apple.

I also don't believe your metrics is right. Comparing PE, PB, PEG is not a standard approach here in the U.S.. You cannot use P.E. to justify why this sector is better than others. You cannot even use PE, PB, PEG to justify market valuation for individual stocks. I have no problem when you use these numbers to say that you are uncomfortable with FXI. The question is why don't you also use the same metrics on other 1000 U.S. stocks? For example, MA.

My expectation is that FXI and PGJ will be winners again this year.