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Moby Waller
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Moby Waller is a former CBOE Market Maker floor trader and off the floor London-based European Index Options Trader. He now works with BigTrends.com and is a Research Analyst and Portfolio Manager for BigTrends.com's ETF TRADR (http://www.bigtrends.com/getstarted/etfgrowth/), which provides... More
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  • The Chinese Online Dragon (BIDU, GOOG, AAPL) 0 comments
    Oct 26, 2010 11:22 AM | about stocks: BIDU, GOOG, AAPL, FXI

    Internet companies from China, especially search portals and gaming companies, have been on fire for some time now.  Investors and option traders have seen the massive potential of this emerging (or already emerged) economic giant.

    Nowhere is this more obvious than in the stock of Baidu (NASDAQ:BIDU), the leader in online searches in China.  Recent data shows that BIDU has around a 73% share of online searches there, with Google (NASDAQ:GOOG) second at 25%.  Ignoring any political aspects that contribute to the dominance of BIDU, the company and stock have certainly been doing well. 

    Since the March 2009 market bottom, BIDU shares have far outpaced two of the biggest technology growth names, Apple (NASDAQ:AAPL) and GOOG.  See the performance chart below:

    BIDU v AAPL v GOOG Performance Chart


    Recently BIDU shares have broken out to the upside yet again.  This appears likely to be portfolio managers chasing year-end performance, in my view.  While some may find the business and (un)competitive tactics of many companies based in China to be a bit unsavory, traders have the choice to hold their nose and make profits.  This is similar to the moral concerns that some have about companies in sectors such as Tobacco and Guns ... locking out certain groups from your trading can hamper your overall returns.

    Disclosure: No positions.

    Stocks: BIDU, GOOG, AAPL, FXI
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