Gone Completely Chinese

wombat42_2

I have ditched investments in JP Morgan Natural Resources as it has been very volatile of late and also I think the "commodity supercycle" idea may be hyped. Even if commodity prices keep rocketing it doesnt automatically follow that mining shares will rocket as they may have to pay more on overheads and also mining shares tend to reflect the wider market.

I now have a sizable wodge in Gartmore China Opportunities and Jupiter China Jupiter funds. They are both long term investments (over 10 years) and i have a sizable cash buffer as rainy day money.

One thing I must stress is that Gartmore China Opportunities and Jupiter China funds actually mainly invest in the Hong Kong market which is less risky and more mature than the mainland China stock market (only available to the Chinese themselves).

Aegis

If your thread title is accurate (i.e. gone COMPLETELY Chinese), then you might want to reconsider. Having all your eggs in one basket like that might well cause you massive problems in the long run, especially if this growing market in China decides to crash at some point. Yes, volatility is a problem in high risk funds, but transferring out of one high risk fund and into an equally risky one doesn't sound like the best idea I've heard.

If the China fund devalues now, you'll have lost out twice by doing the transfer!

Still, good luck with whatever you decide

wombat42_2

Aegis wrote: »

If your thread title is accurate (i.e. gone COMPLETELY Chinese), then you might want to reconsider. Having all your eggs in one basket like that might well cause you massive problems in the long run, especially if this growing market in China decides to crash at some point. Yes, volatility is a problem in high risk funds, but transferring out of one high risk fund and into an equally risky one doesn't sound like the best idea I've heard.

If the China fund devalues now, you'll have lost out twice by doing the transfer!

Still, good luck with whatever you decide

Yep it is a risk but also there is huge potential in China. Most commentators say that China will have sustained high growth for many years. There is of course a chance it will all go pear shaped but that could also happen in the UK market. In the recent stock market turmoil, the China market has been almost entirely unaffected and Hong Kong has only been mildly affected.

China will soon take over from Germany as the third biggest world economy.

IFAs say investing in a single country is risky and that you should invest at least 50% in the UK. Well isnt the UK a single country ? The UK market got zapped much worse than the China/Hong Kong market in the recent stock market turmoil.

dunstonh

I have ditched investments in JP Morgan Natural Resources as it has been very volatile of late

Ive just put some in. The fund is always volatile. Its a very high risk fund.

YorkshireBoy

wombat42 wrote: »

In the recent stock market turmoil, the China market has been almost entirely unaffected and Hong Kong has only been mildly affected.

Gartmore China Opps has fallen 14.4% in just over 3 weeks, with half of it lost this week alone (excluding today's re-pricing).

I suppose it depends on your definition of "mildly".

EdInvestor

Of course a major reason the JPM fund has done well lately is because it is invested in oil and mining shares which have rocketed due to increased prices due to high demand from

wait for it

.

.


.

China.


What goes around comes around, as the Buddhists would say

wombat42_2

YorkshireBoy wrote: »

Gartmore China Opps has fallen 14.4% in just over 3 weeks, with half of it lost this week alone (excluding today's re-pricing).

I suppose it depends on your definition of "mildly".

I dont think that is any worse than, say the FTSE100, and if you consider the YTD the difference is stark, China Opps up over 20% even now, and the FTSE100 down about 8%.

On a rising market I would expect China Opps to rocket more than say the FTSE100.

wombat42_2

EdInvestor wrote: »

Of course a major reason the JPM fund has done well lately is because it is invested in oil and mining shares which have rocketed due to increased prices due to high demand from

wait for it

China.


What goes around comes around, as the Buddhists would say

I was aware of the reliance of the JPM fund on the Chinese economy but also the JPM fund performance is more closely linked to the performance of global stock markets than China Opps.

influence

While the general economy is up and expected to be up for China, they are still picking up in terms of policy making and corporate structure. Ignoring any remaining corruption problem, it will still take a while for them to get completely developed as a free and stable economic powerhouse.

Why don't invest in an Asian fund? Many countries in Asia have a more established market including Singapore, Hong kong, etc. These funds are also including equity from India, China that have strong GDP growth at least for the next years. Such fund tend to diversify risk and allow greater flexibility for fund managers to relocate the portfolio accordingly.

Of course, it might not have such a high return. It still offer a reasonable return so far.

To me as a value investor, two rules comes before making money.
1) Ensure I don't lose money or at least I lose just a bare minimal.
2) Don't forget rule #1.

Otherwise, it just make your investment more of a gamble in the end. Note the market volatility is high and especially so for retail investors like us.

wombat42_2

influence wrote: »

While the general economy is up and expected to be up for China, they are still picking up in terms of policy making and corporate structure. Ignoring any remaining corruption problem, it will still take a while for them to get completely developed as a free and stable economic powerhouse.

Why don't invest in an Asian fund? Many countries in Asia have a more established market including Singapore, Hong kong, etc. These funds are also including equity from India, China that have strong GDP growth at least for the next years. Such fund tend to diversify risk and allow greater flexibility for fund managers to relocate the portfolio accordingly.

Of course, it might not have such a high return. It still offer a reasonable return so far.

To me as a value investor, two rules comes before making money.
1) Ensure I don't lose money or at least I lose just a bare minimal.
2) Don't forget rule #1.

Otherwise, it just make your investment more of a gamble in the end. Note the market volatility is high and especially so for retail investors like us.

If you had stuck with a good old FTSE100 fund you would have been stung just about as bad.

I take your point about diversity.

Yes i was actually in an Asian Pacific fund a short time ago but one thing that irritated me is that it had a big slice of Australia in it which i didn't want and nearly all Asian Pacific funds do this.

I AM NOT SURE IF YOU AND OTHERS PICKED UP ON THE POINT I MADE IN MY ORIGINAL POST THAT CHINA OPPS AND JUPITER CHINA BOTH ALMOST ENTIRELY INVEST IN HONG KONG WHICH IS A MUCH MORE MATURE MARKET THAN MAINLAND CHINA.

ixwood

Wouldn't gone HK be a better title then?

Where does HK make it's money? Is it in China? I've really no idea.

I don't think china is a great bet, if you consider how much trade they do with the US. Surely a US recesssion would hurt China bad?