Share Prices & Company Research

Press Release

14 February 2018

Beware: The Year of the Dog

Investors are urged to exercise caution during the Chinese Year of the Dog.
 
Last year was the Year of the Fire Rooster, a symbol of optimism and confidence. Joel Dungate, Investment Analyst at Redmayne Bentley, said: “Investors in Chinese markets enjoyed a strong 2017, whilst emerging markets in general comfortably beat Wall Street. This positive stock market performance reflected the strength of the Chinese economy which grew by 6.9% last year, ahead of Beijing’s 6.5% target.”
 
The Chinese lunar new year begins on Friday (16th February). Investors of a superstitious nature may be interested to know that, as well as being associated with loyalty, honesty and responsibility in the Chinese zodiac, the dog is traditionally seen as a symbol of luck.
 
So what is the outlook for the Year of the Dog? Joel said: “All the signs are that the Chinese economy could enjoy another strong year, but I would urge caution. The exact health of the Chinese economy is not always clear and many companies are not particularly transparent in their reporting.
 
“Given this, I would suggest to anyone looking to gain exposure to the Chinese economy to consider emerging markets funds more generally. It’s always a good idea to try to benefit from a professional in this space, who has the time to analyse markets which are often quite opaque.
 
“I would also suggest sticking to collective funds which invest in some of the larger Chinese stocks such as multinational e-commerce firm Alibaba, which has benefitted hugely, and is likely to continue to benefit, from China’s rapidly expanding online economy.”
 
Please note, our view does not constitute a recommendation to buy or sell the investments mentioned. Investments and income arising from them can fall as well as rise in value and you may lose some or all of the amount you have invested.
 
 
Beware: The Year of the Dog
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