- The first risk is a possible contraction in the Chinese credit cycle.
- However, any kind of interest rate spike leads to immediate PBOC intervention.
I have been pretty bullish in my previous articles about investing in China as I think it’s a positive risk reward situation. Nevertheless, a positive bull case wouldn’t be fair without looking at the risks China carries. So in today’s article we’ll discuss the main risks plaguing the Chinese economy and stock market. Understanding the specific risks will also help in better positioning your portfolio to the ugly things that might happen and carefully selecting the stocks that will be less affected. More →