Selling China Stocks Short -- Literally
Posted by Dan on March 15, 2008 at 12:59 PM
Interesting post on the Seeking Alpha blog, by Steve Christ, entitled, "Why It's Not Too Late to Short China." Grossly simplified, it says inflation is doing in China's economy and it is not too late to profit from this by shorting China stocks. The way to short China stocks is to buy the UltraShort FTSE/Xinhua China 25 Proshare ETF, listed on the AMEX exchange under the symbol FXP, which has done very well indeed over the last few weeks.
Interesting idea. What do you think?
Full disclosure: I have no position in this fund, but I am seriously thinking of getting one.
Comments
I like it. Thanks for the way to do it.
Posted by: Franklin | March 15, 2008 3:09 PM
If you "ultra short" FXI, you get FXP. FXI tracks 25 H-share stocks traded in Hong Kong not in Shanghai. Their Shanghai listings are traded huge premiums. So I am not sure the rationale of charting SSECI. Often there are signs of tops or bottoms signifying extreme greed or fear. For instance, Bear Stearns' trouble in my read probably marks a bottom of American financial stocks. An article such as this may indicate the slide of FXI is near a bottom too.
Posted by: JXie | March 15, 2008 10:34 PM
China is down what, 25% in the last 6 months?
So much for the "China dream"! Hahahahaa
Posted by: nanheyangrouchuan | March 16, 2008 9:23 PM
I was considering getting into FXP back in November. I didn't. I'm kicking myself now.
Posted by: Chris D | March 19, 2008 8:33 PM