Chinese/Hong Kong investments

wombat42_2

I hope to make a nice profit on my China unit trust ISA/PEP investments over the next year. I will most likely bail out around 2008 Olympics time. At that time, I am tempted just to move it all to ICICI savings account (cash ISA already taken care of). As an alternative, I am just wondering what would be the safest stock market investment I could make that most likely just beats ICICI savings account over the long term (10 year timeframe) ?

dipsomaniac

i don't understand your investment strategy. why would you switch from a very high risk investment (china) into a cautious investment for the next 10 years. are you expecting all stocks/shares to produce zero returns over the next decade??

if you think interest rates have peaked the safest funds are corporate bond/fixed interest interest or any cautious managed fund with a high allocation of these.

wombat42_2

dipsomaniac wrote: »

i don't understand your investment strategy. why would you switch from a very high risk investment (china) into a cautious investment for the next 10 years. are you expecting all stocks/shares to produce zero returns over the next decade??

if you think interest rates have peaked the safest funds are corporate bond/fixed interest interest or any cautious managed fund with a high allocation of these.

For the time being I have more confidence in the China stock market than anywhere else. I was thinking that hopefully in about 9 months I would have enough dosh under my belt to bail out of anything risky and just let it tick over in something safe.

[Deleted User]

Your investment strategy is a bit illogical to say the least.

Your money is always at risk on the stock market

wombat42_2

Yant1 wrote: »

Your investment strategy is a bit illogical to say the least.

Your money is always at risk on the stock market

China is a risk I am prepared to take with the possibility i could get high short term gains. Should I manage to make roughly a 50% gain I would have made enough dosh to allow me to no longer need to take risks and put it somewhere safe.

If China all went horribly wrong I could switch out at any time and I also have a decent cash buffer to fall back on.

dipsomaniac

can you afford to lose 50%

wombat42_2

dipsomaniac wrote: »

can you afford to lose 50%

Yes. It is not likely to have a major impact in me. But i only want to take risk on a temporary basis. You may think the China market is risky but the other world markets are not exactly healthy right now are they? The beauty of China right now is that it is in an almost self-contained world of its own and insulated from the worlds stock market turmoil. And If China crashed, the worlds stock market would barely be affected so I could just switch out.

dipsomaniac

there is nothing wrong with taking investment risk as long as you know the risk and can afford the consequences.

Your previous post suggests that you are convinced that your china unit trust is going to rise by 50% over the next 12 months and that you are gambling everything on this happening. if this does happen what is going to stop you taking the same risk again in the future?

they say that fortune favours the brave and i wish you well.

wombat42_2

dipsomaniac wrote: »

there is nothing wrong with taking investment risk as long as you know the risk and can afford the consequences.

Your previous post suggests that you are convinced that your china unit trust is going to rise by 50% over the next 12 months and that you are gambling everything on this happening. if this does happen what is going to stop you taking the same risk again in the future?

they say that fortune favours the brave and i wish you well.

Because after I have made 50% i wont really want any more dosh.

Also a fair number of commentators believe the Chinese authorities wouldnt dare pull the plug on Chinese equities before the 2008 Olympics, see:
http://www.thestreet.com/newsanalysis/investing/10359428.html

So it is window of opportunity. I am also closely monitoring economic developments on China on a daily basis and if it all looks too dodgy I will pull out.

The authorities could have pulled the plug on Chinese equities a long time ago but they have chosen not to. There are huge numbers of Chinese with nowhere to save their money except the Chinese stock market.

Also I am investing mainly in Hong Kong not China which is significantly less risky.

EdInvestor

wombat42 wrote: »

The beauty of China right now is that it is in an almost self-contained world of its own and insulated from the worlds stock market turmoil. And If China crashed, the worlds stock market would barely be affected so I could just switch out.

Also I am investing mainly in Hong Kong not China which is significantly less risky.

Err....why do you think the Hong Kong market is not affected by what happens in world stockmarkets?The reason it is "less risky" than the Chinese markets is because it is an open market and you can get your money out.But open markets are part of the world stockmarket system and thus likely to be affected by what happens elsewhere.

You can't have it both ways.

Hang Seng index chart

Is that volatile enough for you?

wombat42_2

EdInvestor wrote: »

Err....why do you think the Hong Kong market is not affected by what happens in world stockmarkets?The reason it is "less risky" than the Chinese markets is because it is an open market and you can get your money out.But open markets are part of the world stockmarket system and thus likely to be affected by what happens elsewhere.

You can't have it both ways.

Yes Hong Kong is affected by world markets but still less so than most markets as it is mainly a conduit for western investment into China. Hong Kong is a more mature and more tightly regulated market than China.

As for your graph, it isnt that alarming if you show the full graph from the zero Y axis upwards rather than just the top section, Anyway you need a graph of Hong Kong H shares not Hong Kong in general as I am invested in H shares and some B shares. I notice that your graph shows Hong Kong back on a high unlike any other world markets.