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China stock boom

The tail of the chinest<dragon you have to

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Unformatted text preview: the tail of the Chinest<dragon, you have to hang on t igh t . I I . .-- . ' ,'- .- . . . . ' .. '. " :'. : : ~- : ', ' " ,-: -,-- :- :- : ', . , ponential r ise o f the count r Y's mid- ~ d soo ri er or laterprofit margins dIeClass,which is giving c onsumers \ v i ll be erod e d. " . . the money t o b I JyeverytlriJlgfrOmin- '. '. BuyiIl~indiv i dual Chinese stocks sutance to ice cream with a ven-has gotteneasier > Twenty-twocom- geance . "The most signifiCantdevel- paniesonthe Chiila 100 are listed opment is . a purcha.siilg~power onAillerican excha.nges,vs.l~ the . increase," she says,pointing to mar-year bef6n::.Butthat doesl l 't mean . ket leaders like China Mobile,iil- it's wise. "It ' s atypical emerging surance company China Life , a rid marke t , saysXue ~ ''High volatility AirChinaasthetypesofbusinesses and high risk" . that stand to benefit Thus, for most foreigners thebest Frederick J i ang , who manages way to i nvest in China- is to b u y one the1vy PacificOpportunities fund, . oftbe~()wingarray > likes those sector-leading picks tOQ, of mlitualfundsorex- , . but for a slightly different reason . chan~ectraded funds Many "public" companies in China focused on the coun " are st i ll state '-owned enterprises m try. Still, Morningstar which the government keeps as analystWilliamRoc O much as a 75% stake. That often : cantions that even means the compamesare assured of China , ~focused fi l nds maintaining their dominant posi- are toonarrow and volatile for : ariy- tion. "You want to focus on almost- one who doesn't already have a monopoly powers," says Jiang . On broad international portfolio . the other hand, Jiang steers clear of One solid choice is Matthews sectors traditionally thought to be China (MCHfX),managed by Mark the nation ' s strengths : manufactur- Headley and Richard Gao, a for- ing and exports. "In China capital . mer Bank of China trader. The is cheap, labor is cheap, and tech- . fund has a 17 . 4% average return nology is readily av~ilablt':,"be says . over the past five years and one of "We see veiyfierce competition , the lowes t e x pense r atios, 1.3% , FFEDBACK inv es [email protected] of any China fund. Moreover Gao , For aDthe latest stoc:k data an d . In-depth research and analysis, go to FORTUNE's home on the web, CNM l\'l Q ne y .eom....
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