CSI 300 outperforms S&P 500, Chinese tech outruns Nasdaq 100. How has China’s new economy sectors including its recently launched “Nasdaq” – the STAR board (Shanghai Stock Exchange’s Science and Technology Innovation Board) – outperformed global indices despite being at the center of a trade-tech war with the United States?

Sep 01, 2020

Highest recorded yield spread between the China 10Y Government Bond and the 10Y UST. The yield spread between the China 10-year government bond over the 10-year US Treasury recently hit its widest ever recorded level.

Aug 25, 2020

In the midst of a US tech bubble, Chinese and Hong Kong equities have emerged in the sweet spot between valuations, profitability and balance sheet strength.

Aug 18, 2020

Are US indices rallying because of COVID-19? The most common narrative is that “US stocks have been rising despite the pandemic.” Perhaps a more accurate explanation is “US stocks have been rising because of the pandemic”.

Aug 12, 2020

After the fall in Q1, global equities recovered sharply in Q2 as the COVID fear eases and stimulus packages kick in around the world. YTD, China is the best performing emerging market, and the broad CSI 300 index gained 14% in the second quarter. From factor investing perspective, we continue to see the dispersion of a two-speed-economy despite an overall beta pick up. Quality growth new economy stocks continue to be the winner.

Aug 11, 2020

Back to the future. Clues to US policy makers’ long game for the Dollar can be found in the long-term historical relationship between money supply growth, the inflation rate, and nominal GDP growth. Conclusion upfront: We are likely to see a long cycle of aggressive US monetary expansion ahead – to depreciate the Dollar, revive inflation, and boost nominal GDP growth.

Aug 03, 2020

Global equities have been doing well in the past few months right after the sharp sell-off in the first quarter of this year. Intuitively, the rally looks like classic irrational exuberance given all major economies are heading into recession whilst the coronavirus infection has no sign to slow down globally. On the other hand, the forward-looking market movement may suggest that investors have looked beyond the pandemic and already positioning themselves to capture the V-shaped rebound. Combined the solid fundamentals with an appealing valuation, China A-share looks like an exposure that investors should accumulate whenever there is a market dip. If so, the more imminent and value-added question for the investors will be what to own in the onshore market.

Jul 23, 2020

COVID-19 will likely go down in history as – among other things – an accelerant for a range of tendencies are already present prior to the pandemic. AC (after-COVID), these are the four major behavioral changes that are unlikely to revert to life as we knew it BC (before-COVID).

Jul 21, 2020

The international media reckoned a front-page editorial in the China Securities Journal calling for a “healthy bull market” to create “new opportunities in crisis” was responsible for last week’s red-hot run-up in the Shanghai Composite Index. But perhaps there are less “exciting”, but more enduring, explanations for the surge in Chinese stocks.

Jul 13, 2020