Product Description: From the million-copy-selling author of A Random Walk Down Wall Street, the perfect guide to investing in the next economic giant.
It is no secret that China has the world's fastest-growing economy. The trick is how average investors can tap into the opportunities it affords. Burton G. Malkiel, longtime friend and adviser to ordinary investors through his great book A Random Walk Down Wall Street, now gives them China. In From Wall Street to the Great Wall he explains why and how the Chinese economy is poised for significant gains in the near future. It highlights not only Chinese firms and industries but also multinationals in the United States and elsewhere that are likely to benefit from China's explosive growth. Following this tour and analysis of investment opportunities in China, including the stock, commodities, real estate, and even art and collectibles markets, the book reviews these options and sets forth a grand strategy, including sample portfolios, for investing in China.
Good Read... As a Financial Advisor I am always looking for different ideas/opportunities to incorporate into my clients' investment portfolio. While at the library with my son, this book and the title caught my eye and I immediately began reading the book thus checking it out. It is a fine read that begins with the history and politics of China and eventually leading into the markets, its efficiencies and some particular investment options/strategies to capture, what has been and should continue to be,an economic boom in China.
It is a good, easy and enjoyable read but you must take the authors' somewhat biased opinions with a grain of salt - as with anything.
I do agree that there is a huge opportunity for profits and a place in one clients' portfolio for an investment in China and have over the last few years been adding such.
I would recommend this book.
Booster Club for Investing in China Knowing that Malkiel is the father of efficient market hypothesis and wide diversification, I find it somewhat surprising that he has written a book on investing in a specific country. The brief summary of China's culture and history gives some background on how China found itself in the turmoil of the Cultural Revolution and why it lacks qualified accountants and financial analysts (an entire generation sent for reeducation).
The chapter covering risks is titled "Perceived Risks", and Malkiel basically debunks most of them as fiction or explains away the risks by pointing to the cultural pride, work ethics, and other factors to overcome them. It seems one-sided much like apologetics and boosterism. Maybe I'm skeptical, but it's not a foregone conclusion that China will avoid all their problems, political, social, economical, and become the dominant economy in the world. And no stock market only goes up.
What Malkiel does a good job of is explaining the tests of efficiency for Chinese stocks. He explains the alphabet soup of A share, N share, H shares, and concludes that as of 2005 the N and H shares a pretty efficient. However the A share market is still inefficient and subject to manipulation. He also explains the discrepancy of pricing between shares of the same company in the different exchanges. Furthermore it is confusing how to analyze the earnings, growth, profitability of state owned enterprises, who are 70% owned by the government and only float a small percentage of their shares on three different exchanges where they are all priced or bundled differently.
He concludes with several strategies for small, medium, large investors, with portfolios of ETFs and/or index funds. And for the true speculator he covers a few of the stocks in each industry. But as in any book, the information will be woefully old and out of date by the time it is published, printed and read. For the average investor who wants to have an exposure to China, I would personally buy a mixture of China index funds (GXC, FXI) Vanguard Emerging Market Index (VWO), but don't let that be your entire portfolio. Malkiel recommends a percentage based on your risk tolerance. For this wisdom, I don't think you need to buy the entire book, unless you want to learn about the various ways stock is available (Chapter 4).
Diversify broadly, include China, and be careful As always, Malkiel's mantra is to diversify broadly. In all editions of his famous "A Random Walk Down Wall Street", he urges people to invest according to their means and situations, to diversify their investments across industries, and also to diversify internationally.
But why write a whole book about one national economy if your mantra is to diversify across them? It's because, quoting the authors, "there is no question that China will shortly surpass the United States and once again become the world's mightiest economic power". As such, Chinese assets deserve a special place in anyone's portfolio.
The book gives a very brief account of Chinese history, followed by an overview of the Chinese investment markets, and finally a collection of investment strategy. Of these, Malkiel only recommends one (diversify broadly within China, invest regularly rather than all at once) but he describes other viable strategies for people with a higher appetite for risk.
It's open to debate whether the Chinese will come out on top in the near future. After all, as we can read in China's most famous work of literature "empires wax and empires wane". But given that China has the world's oldest continuing, recognizable national identity, given that she is becoming freer and freer, and given that China is intensely motivated at all levels to improve herself, it would be foolish and dangerous to dismiss her.
Vincent Poirier, Dublin
very useful book to help me invest in China The process of reading this book was very happy. It's really a very useful book to indicate me to invest in China no matter in the bull market or other types of the market.
An Investor's Guide To Investing In China's Economy In my opinion, this is an excellent guide for any individual investor who feels he (she) may want to "profit from China's booming economy." Even if the reader decides not to invest in China, the account of how far China has come in a period of approximately three decades is an interesting and amazing read.
The book is divided into three sections: The Setting, which provides a historical background on China and its people; The Investments, which explains how Chinese securities are structured and traded; and The Strategies, which provides advice as to how investors might go about investing in China's economic success.
The final chapter, The Optimal Investment Strategy, presents the authors advice as to how an individual investor might pursue an investment plan and at the same time minimize risk. The authors throughout the book emphasis risk and in the final chapter clearly state, "We warn you in advance that it is not an exciting strategy that will make you a millionaire shortly after reading it - but it is a strategy that sharply curtails your risk."
Another reviewer of this book has made comparisons of this book with Jim Rogers' A Bull In China. In my opinion, From Wall Street to the Great Wall is a far superior read. Burton Malkiel has the academic credentials and decades of experience in teaching investing to students. He has also been on the board of directors for many years at the Vanguard Group, a company dedicated to the best interests of individual investors. The average investor would be foolish to invest directly in Chinese companies as Mr. Rogers suggests. That would be like walking through a mine field. I suggest sticking with the advice of the professor.
Anything Goes Trivia
Megaton Man
Trevor
