Buy and hold ETFs of mainland China?

Discussion in 'ETFs' started by Cabin111, Feb 11, 2018.

  1. Cabin111


    Just throwing this one out there. Going back to 2007-9...The great recession (don't remember the correct time period, but you get the point). The US spent 1 trillion dollars+ on infrastructure and it got us diddly squat. China took their time and money and built high quality infrastructure (example trains to Europe)! Whatever happens to the US market for the next 5-10 years, it still seems like China would be the way to go. You would buy and hold things like HAO, QQQC. You could do covered calls on them (way out of the market). Get the dividends...Wait years. Let the US try and fix their infrastructure NOT!! If and when China comes roaring back (yeah, I know it's been roaring pretty good at this time), but if you are in a recession, to hold onto quality stocks of China into retirement would seem like a wise thing to do. Thoughts?? As you can tell...Long term investor here...Who just does covered calls.
  2. JackRab


    I don't see the point in covered calls... they just hold you back.

    Regarding the US spending money... you do realize that the current equity markets are up... a lot... SP500 was at 735 early 2009 and now at 2620, even after the roughly 10% drop in the past 10 days... that's up 250%!

    So if you call 250% return over 9 years is diddly squat... you need to get your head checked..

    Also... do we really need to write in really big letters? Are you using your TV which is 6 ft away?
  3. Cabin111


  4. Cabin111


    Jack, new to this site...Didn't know what font size most people use. I'm 62...Don't want to put on my glasses. Concerning the market...Yes, I know what the markets have done. I have been an active investor for 20 plus year. What I am talking about is infrastructure!! The US is worse that Europe or much of Asia on their infrastructure. It reminds me of eastern Europe. Even with much of the new budget going to infrastructure, it will not make a dent into what really needs to be done. This will haunt the US for years go come.

    China on the other hand has gotten better at the quality of their projects...Still not as good as the US or Europe...But much better. Concerning covered calls, I do a lot of them...Just me. I am doing them further out (time wise/leaps). I also try and do them way out of the money. It's just a small amount of extra income. If the stock falls, I have my option money and my dividend. I then can write another option later. This works for me. Yes, it is the MOST conservative option to write...But it works.

    I may make 7-10% annual return, but unless I have bought something like a RiteAid, I can make a fair profit with very little risk. Think ADM, T, VZ...

    Concerning holding a basket full (ETF) of China stocks...It seems like a no brainer. But am I missing something?? Please shoot holes in the idea of buying and holding China...That's what I want to hear...
  5. Jack1960


    China has a big debt problem.
  6. JackRab


    Everybody left and right is talking about China's big debt problem... what about the debt of the US?

    China's national debt to GDP is way better than USA. Likely there's a bit too much in private debt... but China is not going to let it blow-up. So I don't think that debt problem is that big of a deal.

    China's growth has been coming from infra, they have been moving people from the country side into cities for years... (and with they, I mean the government has pushed that). They way I hear, they have been spending almost too much on the infrastructure and there's not enough people at the moment to fill those cities etc. But progress in technology and the speed of growth in education etc has been enormous, which will likely see more and more people living in cities having city jobs.... compared to farming etc.

    The problem of China is valuation. We don't really know how to value China's economy, since a lot of the macro figures are likely to be somewhat doctored. And on the back of that... are companies reporting real? And what growth is already projected in current stock valuations? They have higher growth projections, so I assume PE ratios are generally higher than of Western companies.
  7. Jack1960


    In U.S. we do not care about the debt. God has gives us the right to a free lunch. We are special. Both parties love it. Trump loves it. Foreigners loan us the money.
    Someday the government will demonetise the debt.