Investors in Chinese stocks used to bet on growth. Now, they are hunting for bargains.
Portfolio managers say that investors who are still eager to get exposure to China are increasingly turning to value investing. That is a style of stock picking that focuses on finding shares trading below what they are really worth—based on several different measures—rather than looking for companies with big growth potential.
The shift in emphasis from growth to value reflects the stark change of fortunes for China’s economy, which is faltering after years of breakneck growth. Exports and manufacturing have weakened this year, the housing market is in a funk and consumer prices have moved into deflationary territory. While U.S. stocks have surged this year, the MSCI China Index, a broad gauge of Chinese shares, is down more than 7%.
Read the full story on The Wall Street Journal here.