INVESTING IN China shares has turned out to be a roller-coaster ride for many Singaporeans.
After a fantastic run-up last year, the roller-coaster is plunging as China shares listed on the Singapore Exchange are down by around 50% since last October.
It’s easy to turn pessimistic as a result of sharply rising inflation in China, the rising cost of raw materials, and so on.
Jim Rogers, 65, the investing legend who has relocated to Singapore, has been and remains a bull on China, however. In fact, just a few months ago, he published a book on precisely the topic of why he is a bull on China.
In interviews with Fortune magazine and In Focus, he shared insights into why China is a great place to invest your money, and why commodities is his key chosen vehicle.
Excerpts:
How are you investing in China now? Are you buying shares of companies? Indexes? Real estate?
I own the currency. I own commodities. I do not own real estate. I have not bought any indexes. Rightly or wrongly, I think I can pick shares better than the index. All the studies show that most people can't do that. I haven't bought any new shares lately, but if I did, I would buy them in Hong Kong or Singapore or London or New York, because they're cheaper than on the mainland.
You've long been known for spotting exotic investment opportunities in your travels. Have you come across anything exciting off the beaten path recently?
I've sold out of all emerging markets except China because there are so many people right now trying to exploit emerging markets. There are 30,000 MBAs flying around the world looking to invest in them. Some of my investments I owned for 20 years. But I'm not looking for new opportunities, I'm getting out - places like Botswana, Ivory Coast, and Ghana. Botswana I hated to sell. Peru has been hot as a firecracker for a while. Uruguay I sold. All of it. But I'm keeping my money in China.
Full Fortune article, here.
How can investors profit from the rise of China?
The best way to profit from the rise of China is to buy commodities. Because the Chinese NEED commodities. If you own nickel, they will pay you on time, they will be nice to you, and they will take you out to dinner. You can of course also buy the shares of natural-resource companies, and if you are really good at it and pick the right stocks, you will make a fortune in China. But then you will have to worry about the stock market, the management, the central bank, labor unions and a hundred other things. If you simply buy nickel, you don't have to worry about any of that.
Full In Focus article, here.
