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Hot China Stocks: A Bubble to Avoid

Even the behavior of SDTH and JRJC are totally different. In the past month, JRJC went up from roughly $10 to $40, while SDTH was from $5 to $7. How could the author put these two stocks in the same group?

China's Only Real Inflation Solution: Let The Yuan Float

If China raises their currency value, that will make all the imports to US and the rest of the world much more expensive, which in tern will drive up US as well as the rest of world’s inflation rate significantly. Applying your theory, does that mean that US currency and the rest of the world’s currencies against Chinese RMB will be under valued because of the higher inflation rate, so they will have to raise their currency values against Chinese RMB to reduce the price of the Chinese imports? Does it sound like a endless loop to you?

China's Only Real Inflation Solution: Let The Yuan Float

If China raises their currency value, that will make all the imports to US and the rest of the world much more expensive, which in tern will drive up US as well as the rest of world’s inflation rate significantly. Applying your theory, does that mean that US currency and the rest of the world’s currencies against Chinese RMB will be under valued because of the higher inflation rate, so they will have to raise their currency values against Chinese RMB to reduce the price of the Chinese imports? Does it sound like a endless loop to you?

China's Latest Financial Coup: Buy 'H' Shares

This author is keeping writing misleading articles, or using his own words, nonsense. In 8/16’s article, he said Shanghai index “plunged about 6% today alone! ”, when in fact it only lost about 2%, and it was the only one of a couple meaningful drops SSE had over a month during which SSE gained 40% from 3550 to 4900. Of course his article would be “contested”, because not all people are as blind as he was! Since that article published, US market has had a U-turn, so has SSE, which in 3 days gained over 300pts or 7%. Today, SSE closed at an all time high of 4980, just shy of 5000 historic mark. Yet the author came out with another almost laughable article, claiming that Chinese RMB is OVERvalued, and “Everyone in China distrusts their own banks”, LOL! Is this guy living in vacuum, or does he have some hidden agenda? He said “We have warned clients…”, blablabla. I truly hope his clients will not take what he said in earnest, otherwise they’re not gonna do well. Period!

Chinese Markets Beginning To Crack

Well, turned out that the author has had a bad luck and picked a market bottom day to write this erroneous and misleading article. Right after the article was published on Thursday, US market rebounded sharply on Friday, which as I predicted pulled up the world markets as well as Chinese markets with it. In just finished Monday trading session, Shanghai composite finished up 5.33% to completely wipe out the mild losses it endured last Thursday and Friday triggered by the US led world market meltdown, this has put Chinese stock markets back to the upward trend. In my view, Shanghai composite index will break 5000 mark in next one or two sessions, and continue moving up from there once it absorbs some possible mild profit taking at that historic milestone.

Once again, “wolf” didn’t come. The crying baby lied again…

Chinese Markets Beginning To Crack

What a misleading article this is! "it plunged about 6% today alone!", sounded like it has been cracking all along. The truth of the matter is, Shanghai Index has gone up for 9 consecutive sessions for over 20% before today's drop. And, you know what's the reason for the drop - the US led world market meltdown! So, as soon the world market stablize, or even without it, the Chinese market will resume upward trend. In my view, RMB has 30% appreciation possibility in the next 5 years, that alone will facilitate a 500% growth of Chinese stock market up to 25,000.

Stop crying "walf is coming". It never came, and never will!

Shengda Tech: A Cheap Chinese Smallcap

Ding, good info. Thanks for the digging. Let's see how SDTH behaves today.

Shengda Tech: A Cheap Chinese Smallcap

dy - if you check Yahoo Finance you would see that the Fri. volume was 2.3mil. A further check reveals that about 1.1mil of them were traded after hour. Taking NASDAQ cross-trade into account, you're right that there might be just one big trade at the end of session amounted for about 1.1mil. The question is, who is buying? Even more importantly, who is selling and why? By looking at here finance.yahoo.com/q/mh... we see that only one institution JLF ASSET MANAGEMENT, L.L.C. that holds over 1mil shares of SDTH, so the trade could either come from this guy, or from insiders. In either case, this is not a terribly good sign. It’s alright that someone (perhaps a new institution) wanted to get into SDTH by taking that 1mil. But if that purchase was done in open market, it would have pushed SDTH to go over $6 for sure. The fact that one big insider and/or JLF dumped that amount of shares at $5.62 to the buyer doesn’t look too encouraging to me. Guess Monday’s moving trend will tell us more about the nature of that big trade?

Shengda Tech: A Cheap Chinese Smallcap

Great article! Very exciting analysys about the potential earning growth related to the new 100,000 tons facility coming into production later this year. Also, the two conference call links are extremely helpful. Thanks a lot!

BTW, any one noticed the huge volume at the end of trading session last Friday? Something like 2mil shares were traded at the last minute. Must be a change hand between two big institutions? Any comments?

Chinese Small-Cap Stocks Not Frothy

Well, the issue of ACTS is that it has a negative growth of 15% due to the lower ASP, etc. In fact, the current PE is 7, "ridiculously undervalued" as you may say, but the forward PE is at 8, that shows no growth what so ever. After all, ACTS is in a tough semi-IC industry where seasonality can be a killer.

If you want to look for a good Chinese prospect at the same price range, look SDTH. At $5.70, with current PE of 15, but forward PE of 9.8, this company has been keeping an CAGR of 30% or more. That's why I have bought into it big time, hoping to keep it for a year, and get 100% return.

Good luck!

ShengdaTech: Undervalued Chinese Chemical Manufacturer

Excellent article and analysis! SDTH is one of those hidden gems that will be picked up sooner or later. As the matter of fact, the volume of past three sessions shows that SDTH has caught a lot of attention since that pre-announcement (I myself being one and have since bought several thousand shares of it and counting!). I agree that with the low PE comparing to peer, especially the extremely low PEG of only 0.27 (1 being fairly priced, the small the better), SDTH has a significant room for further price appreciation. $8 ~ $10 would be an easy reach from here.

Morgan Stanley China Closed End Fund: NAV Up While Market Price Lags

The more discount, the safer to buy CAF. At some point, something will happen to correct the situation. I see two things could happen - 1. someone who has the market maker capability will come out and buy CAF in the open market and redeme for underneath China A-share, and then sell them in A-share market for huge profits. Their buying would effectively reduce the discount. Citigroup did so in IFXAF, sold over 25% of total IFXAF shares and effectively reduced the discount gap from 16% down to 8%. Another thing could happen is that Morgan Stanley could decide to change the close-end fund to open-end fund, thus to eliminate the discount all together. In any event, these shorts will have to cover sooner or later. So the bigger the discount the safer to buy to buy now.

Last Sat. I predicted that Shanghai composite would go up this week and finish above 4300 by the weekend, and finish above 4500 by the end of June. Apparently I was too conservative again - SSE took only two trading days to finish at 4335 last night, up 4% from last Friday's closing of 4170. Is it possible that 4500 will be taken down by the end of this week? Well, at this point I don't see any force existing that can stop this. If it does happen, then 5000 would be the milestone to June! Will the gain translate to CAF? Hopefully! At 4500, CAF's NAV will be roughly $50. If CAF still stuck at $36, then the discount will be roughly 30%! Sounds like a bargain for Fidelity and the likes to chip in!!!

The Bubble Theorists Have Shanghai Wrong

That rumor has just been cleared. Shanghai officials have formally denied such a tax increase.

The Bubble Theorists Have Shanghai Wrong

Please be specific and give facts when you talk about frenzy, valuations and individual investors. Just because you got burnt in 2002~2001 in dot com era doesn't necessarily mean that China market investors will get burnt as well. Actually, lots of China market investors did get burnt, but not in China, rather here in US! Not caused by the real China market's crashes, instead by the fears generated by Greenspan and themselves! Look at CAF, yesterday's severe drop forced 900,000 shares out at unbelievable 25% discount, equivalent to SSE’s drop to 3000! So, for those wanting to get into China market, what are you waiting for? You already got the 20% crash of the China market - not from the real China market, but here in US! Ironic, isn't it!

The Bubble Theorists Have Shanghai Wrong

Great piece indeed. People can make a "bubble" case any way they want based on any theory they can think of. But the fact of matter is, Shanghai stock just doesn't go down, period! Took yesterday as an example, all kinds of so called bad news, including Mr. Greenspan's comments, made many people take profits in China markets. But the buyers were just as determined to take the advantage of the rare price drops. The result was that a huge amount of stocks were traded hands, another volume record was created, yet the market were ended up just down a mere 0.5%. That actually generated a healthier upward momentum for the near term, as many profit-takers are out of the picture. In fact, today’s Shanghai market behaved much smoother, with a bit less volume, the index recovered all the losses from yesterday, and then some. Not only that, reports showed that some mutual funds, including some QFIIs, that had been prematurely cashed out and stayed on the sidelines in the previous months have once again started to come back into A-share markets. That to some degree explained the huge volumes in the past couple days. Several other reports have pointed out that, due to the overwhelming warnings from all over the world, a major chunk of money, some estimated at 2/3’s of trading cash, has been sitting on the sideline waiting for the market to go down and get back in at cheaper level. Well, as we all know that, when everyone is worrying about a market, it is the safest time to buy, so called "Wall Street climbs on the wall of worry", right? So, after this week’s fierce fights between buyers and sellers, some latest analysts comments have all pointed to a smoother, calmer and steadier upward trend for the China markets in the near term, with some predicting 4300 by the end of next week, and 4500 by the end of June. But in my mind, the easiest money that can be made now is not in China, but rather right here in US. You can buy CAF at 20% discount of the real SSE market thanks to the fears created by Mr. Greenspan and pretty much all other western analysts. Where can you get this fantastic deal?