China

Is it worth buying into Chinese stocks?

Just by looking at this single little graphic, there should be no doubt from a capitalization standpoint that the Chinese market is worth every bit a look even though there are bears out there that scream bloody murder about how China’s a spinning out of control bubble.

But just by looking at some pretty simple logic should be reason enough to do the research into this market. First, they definitely have the population to support the growth at the speeds that these corporations are increasing in size. The reason that China Mobile (CHL: 54.23 0.00%) has such a large capitalization. Think about it. If your population that you serve is immediately one of the largest in the world and your major urban areas support more potential customers than most major metropolitan areas, wouldn’t your capital be higher than others? This is the simple reason why all of these corporations just by capital forecasts can beat out any most comparisons.

On the flip side, if you’ve paid attention to most Chinese stocks that have made their IPO on the NYSE, those companies are also a lot more volatile since they’re effected by not only the NYSE market changes but also Chinese markets.

Truthfully, China is in an economic upturn as they proceed to advance their technology and thoughts to more of a capitalistic market. What took the United States almost a century, China is condensing the same progress into about a quarter of the time. Due to this condensing, the markets will swing on smallest of news, but overall I believe that it’s worth my time for investment purposes. Call me a bull, but it just seems like the right place to be currently.

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Disclaimer: The author is a shareholder in some Chinese corporations on the NYSE.
Photo Credit: (sandylitg)

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