Good news everyone. The Chinese have done so many awesome things over the past few months, the gurus at Goldman have upped the chances of China being added to the MSCI index from 50 to 70%. There are still some lingering items left on the agenda that might need to be addressed before inclusion, such as onerous repatriation limits, anti-competitive clauses and a sundry of wanton corruption not seen since the days of Sodom and Gomorrah.
Chinese regulators are pressing hard to get their $5.6 trillion house of smoke and mirrors added into the index, likely to get liquid on a fresh group of unsuspecting speculators.
It’s also worth noting that 311 stocks on the Shanghai and Shenzen indexes are still halted since March, representing 10% of the stocks listed there.
On this news, Chinese stocks are soaring this evening, higher by 2.2%. This percent gain might vacillate into the closing minutes of trade, as Chinese regulators pull levers and suspend trading for any companies that get in the way of a good rally.
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If someone is savvy enough to make money off Shanghai be my guest.
I just find it easier to make money with American stocks, I know what affects our market, how stocks are (likely) to move off earnings, and what our market views as noise.
Investing in foreign markets is like short selling, it feels so cool when you win,
but then you realize you could of made more money just going long in America.
Depends on the foreign market you are in, but as for Chinese stocks, I would not touch them. There was a panic selloff just the other day where China markets plunged 10% in one freaking minute. Software kicks in at 10% swings, so it would have been much worse. Beware – you have better odds in a casino in Macau.