China IPOs Soar And Bubble Grows
Two articles in Monday’s Wall Street Journal make two contradictory assertions about China’s still growing stock bubble:
- Smaller stocks from China are overvalued and you should go with the ‘red chip’ companies, at least if you are Chinese (since it is difficult to invest in many of these companies in China)
- Smaller stocks from China that have had IPOs in the US have great potential, although you might need to take a long term buy and hold perspective with current prices
Both articles do give some minor warning that all Chinese stocks might be in a bubble, but that’s a pretty weak standpoint when you consider just how much they have soared over the past couple of years.
China’s stock market might go higher - but they are already in one damn big bubble. What do you think?
