Chinese and Indian stocks are doing good? Are they worth buying or too risky?
Baidu, Yoku, SINA, RENN,Dang Dang, Makemytrip, Naukri etc
Re: Chinese and Indian Stocks - Worth Buying or Too Risky?
dump Chinese in a few months. As dollar degenerates Chinese will be the second worst affected after the US.
Re: Chinese and Indian Stocks - Worth Buying or Too Risky?
^What would cause the dollar to decline further? As interest rates move up and QE2 ends, this should cause dollar to strengthen, correct?
Anyway, very difficult to predict the direction of individual stocks, especially over the short term. Basing the prediction on currency movements makes this game even more difficult.
While these discussions are interesting, I hope noone acts on recommendations given by total strangers (self included). Hopefully each of us does our own homework.
Re: Chinese and Indian Stocks - Worth Buying or Too Risky?
Dollar weakness is due to erosion of fundamentals over long term and is still continuing. End of qeII will be and is a minor bump in the slide.
A lot of Chinese receivables (foreign bonds) are dollar denominated; a huge proportion of Chinese reserves are in dollars. As dollar diminishes therefore china gets poorer. What's worse as the purchasing power of america comes down, chineses exports get hit more and more. As a simple example - the pressure from Walmart to cut price - china exports less and for less!
The other reason for china's slide, that has started since my last post here and is accelerating - within past month Chinese IPOs are trading significantly under issue price. Part of it is overheating - for example one of the ipo's was for a 1 on 1 dating website company in China! Issuing stock in the US! Get the picture?
Re: Chinese and Indian Stocks - Worth Buying or Too Risky?
Need to be very cautious with Chinese stocks. There are concerns about their growth projections, accounting issues and general mismanagement.
Re: Chinese and Indian Stocks - Worth Buying or Too Risky?
Dollar weakness is due to erosion of fundamentals over long term and is still continuing. End of qeII will be and is a minor bump in the slide.
A lot of Chinese receivables (foreign bonds) are dollar denominated; a huge proportion of Chinese reserves are in dollars. As dollar diminishes therefore china gets poorer. What's worse as the purchasing power of america comes down, chineses exports get hit more and more. As a simple example - the pressure from Walmart to cut price - china exports less and for less!
The other reason for china's slide, that has started since my last post here and is accelerating - within past month Chinese IPOs are trading significantly under issue price. Part of it is overheating - for example one of the ipo's was for a 1 on 1 dating website company in China! Issuing stock in the US! Get the picture?
Thanks - makes sense. Looks like you called it spot on.