Finance theory assumes investors buy stocks after considering their return potential, which makes sense. In reality they do anything but. In fact, one of the most common reasons for stock purchase, especially among retail investors, is a look back at where a stock’s price has come from. Using a unique database, the EastMoney GUBA forum […]
Author: Nial Gooding
There are competing theories as to whether letting outsiders into domestic stock markets is a good or a bad thing. On the one hand they bring best practices that assist in a market’s orderly development; but, on the other, they may introduce volatility that results in an undesirable higher long-term cost of capital. Writing in […]
How many times do we hear ‘Chinese buyers are pushing up property prices’ in Manhattan, Sydney, Cheju, London or wherever? But is it true? Do flows of money from Chinese buyers really and noticeably affect real-estate prices in certain areas? In the first study of its kind (I’ve seen) to isolate ‘unofficial’ Chinese capital flows […]
More monograph than research the highlighted piece today from Alicia García-Herrero, the Asia Pacific Chief Economist for Natixis with affiliations to Bruegel (a Brussels based think-tank) and the Hong Kong University of Science & Technology, is a chilling piece if your business is selling mid/high-tech products to China. It’s only 12-pages so I’d urge a […]
That companies don’t do as well post-IPO as in their run up is a well documented phenomenon the world over. The reasons for this vary. In the paper highlighted today Hai Long (et al.) from the Business School, Wuchang University of Technology (Wuhan), writing in the Journal of Risk and Financial Management, takes a closer […]
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HK-2021 IPO Review: Lemons and Peaches
As of December 8th there were 84 Main Board additions in Hong Kong in 2021. One was a listing by introduction and no money was raised but the rest involved subscription. The average loss i.e. the sum of profits and losses assuming an equal swing at the 83 money-raisers was 16% (to Friday’s close, and […]
The Hang Seng TECH Index closed this morning in Hong Kong at a new low and Tencent and Alibaba, among the most substantial businesses in China’s new-economy sector, were down over 40% and 60% from all-time highs. It’d be fair to say then the China tech and new-economy sectors are not happy places. Valuations based […]
Do Chinese companies that produce Annual Reports in both English and Chinese manipulate the English versions, somewhat, to present themselves in more favorable lights? Yes, some of them, sometimes do. Tina Lang (et al.) from the California State University at East Bay drilled through 262 company reports in both in Chinese and English from 2005~2017 […]
Gamestop, Robinhood, meme-stocks, gamification. These terms are associated with just the most recent iteration of the never-ending discussion about whether or not short-term ‘traders’ (hereafter ‘speculators’) are a ‘good’ or a ‘bad’ thing. Analysis in established markets founders on an intractable problem, the lack of a counterfactual. China however may provide a useful case for […]
Often, papers I find to highlight involve a lot of quanti-mumble to get to their points which makes the process of summary writing challenging. Not so with today’s piece which couldn’t be clearer. Sumit Agarawal of the Business School at the National University of Singapore (et al.) wanted to see if Chinese firms (I’d wager […]
At this time of year crystal balls come out and pundits have a go trying to predict trends for the coming year. Central to macroeconomic forecasts, and in turn the potential for stock returns, is what GDP growth may do. In China’s case predicting the trend of GDP growth in 2022 is easy. It will, […]
I kind-of understand what clever folk at Coolabah Capital Investments have done in the paper highlighted today but whether the work has more than party-game interest I’m not sure. You can play with their model yourself and pair up countries to arrive at a) the threat of conflict and b) the possibility of all out […]
In a working paper for the Fondazione Eni Enrico Mattei (a Milan-based sustainable-development think tank) researchers from Tianjin University ZhongXiang Zhang and Liang Ne have produced the first study on the comprehensive CO2 reduction effects of High Speed Rail (HSR). Previous studies have looked at specific lines with some concluding the CO2 produced in the […]
Professor of Marketing at the Indiana University Northwest’s School of Business and Economics Subir Bandyopadhyay takes a closer look at consumer preference for certain foreign products in China. It happens everywhere that consumers make semi-rational quality judgements based on a products’ provenance. Cornish pasties, Idaho potatoes, Belgian chocolates, Colombian coffee, the list of products sold […]
Corruption and poor Corporate Social Responsibility (CSR) in China, you’d think, went hand in hand, right? Brace! Brace!! Researchers Juncheng Hu and Janice Hollindale from the Bond University (Gold Coast) and Lijuan Zhang from the Australian National University (Canberra) found, in fact, “…evidence that CSR in China is a window-dressing tool to mask corruption.” Moreover […]
James Laurenceson, Director and Professor at the Australia-China Relations Institute at the University of Technology Sydney takes a look at the Australia-China trade relationship in the context of calls for the Australian government to more assertively intervene and help out Australian business. The key points: 1. Contrary to popular opinion Australia has not foolishly let […]
Before reading the paper highlighted today I didn’t know what a ‘wicked problem’ was (more here if you care, Wicked Problems). Apparently planners, policy-makers and legal experts come across them all the time, hence the need for a term to describe them. A wicked problem doesn’t involve witches, of the West or elsewhere, it’s one […]
Has China’s last poverty alleviation effort, the one that claimed to have finally eradicated extreme poverty, ended up just giving away fish or did it really teach people how to fish? Huifu Nong of the Guangdong University of Finance writing in a Discussion Paper Series for the Deutsche Post Foundation assisted IZA Institute of Labor […]
Preamble I have a 5-year-rule for IPOs i.e. I won’t buy a company that’s been listed for less. The discipline has been handy as most of the value destruction that’s taken place in the China space this year has occurred via the stocks of companies listed (at least in Hong Kong) with shorter track records. […]
Assisted by collaborators at the Jiaotong University in China Danling Jian of the Stony Brook University in New York tried to fix a bead on the relationship between firm value and where a company’s center of operations are located. I found fault with the analysis based mainly on sample size (1,083 firms in 35-cities using […]