Chinese Stocks Still Hold Long-Term Promise
China has faced daunting challenges this year. Hong Kong erupted in political protests, COVID-19 got its start in Wuhan, relations with the U.S. deteriorated sharply, and the economy shrank 6.8% in the first quarter, nearly two points worse than the rate of decline in America. In fact, for Chinese stocks, it has been a rough five years, with the MSCI China index returning just 2.5% annualized, compared with 8.6% for MSCI’s USA index. (Prices, returns and other data are as of June 12.)
Still, I like China as a long-term investment for a lot of reasons. The most obvious is that, despite threats from the U.S., China is too big for America to do without. China has four times the population of the.
