To what degree do you include (or exclude) China from your investments?
I have some cash that I want to put into a mutual fund fairly soon. Some of the best returns come from the broker’s Asia Value Fund and the China Area Fund. The returns for the last 1, 3, and 5 years are significantly higher than for other mutual funds.
But – both of these mutual funds have large holdings in Chinese companies like Tencent, Alibaba, Huawei, and so on. These appear to be influenced by, if not owned by, pieces of the Chinese government, and that government is not one known for fair play – to say nothing of its stances towards Hong Kong and the US.
To what degree do you let geopolitical factors affect your investments?
yes, there are ‘green funds’ and ‘socially responsible’ funds, but their returns generally suck
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Our portfolio, managed by my husband, contains very little outside the US. We have maybe 2% in China, and less than that in Europe.
I have <0.005% of my investments in China exchange trade funds (ETF) iShares MSCI.
I use to own Alibaba but liquidated it.
Also indirectly through companies in the S&P 500 that have manufacturing done in China.
I avoid investing in China. My international investments are in a European index mutual fund as a hedge against a collapsing dollar. I don’t trust Chinese companies. Corruption and fraud are rampant. It’s also a huge bubble.
There are some Chinese companies that I just can’t get myself to invest in for ethical reasons, like Ali Baba because of its participation in the social credit system.
However, I think I’m mostly acting out of subconscious bias. I would probably still invest in Palantir, for example, even though they are just as implicated in repressive surveillance as anybody else.
I do also tend to think of Chinese investments as more risky because of the looser regulatory environment and my lack of knowledge about the risks affecting Chinese companies. But I also think of Chinese investments as a good way to diversify macroeconomic risk, and to help get grow the economy for the Chinese people (or at least whatever trickles down).
I also won’t invest in Nike, Apple, or Coca-Cola because of what they are doing to Chinese people. Again, I’m probably being inconsistent here and just acting emotionally on whatever headlines I’ve seen recently.
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