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Sunday, September 13, 2009

How To Find Stocks To Buy In China

By Mike Swanson

China's economic growth has continued to be astounding. With the world's biggest populations that has discovered a love of consumer items and needing accommodation the economy has hardly slowed through these tougher economic times. Investing in China is an option for many keen on harnessing emerging markets and the opportunities they present. Some ways identify the best stocks to invest in to get into China are discussed below.

The government will not allow a national company to be bought out by foreign investors and setting up your own company can be difficult. Instead joint-venture operations with a Chinese company are the only way to access the enormous market. But these deals are not without their own risks as a number of overseas investors found out last year with a baby formula tainting scandal that brought down a number of large investors.

Another option is to invest directly in Chinese companies. With a growing level of consumerism and the largest domestic population in the world opportunities for growth abound. Areas that are seeing enormous growth are wireless telecoms and construction. While this is an investment area you need to keep in mind there are a number of restrictions on foreigners purchasing Chinese shares.

Private Equity funding works but some private equity firms have chosen to avoid China. They have found that having to rely on local partners has meant they have not had the information they require or in the time frames they would like.

Invest in Chinese property. This sector is growing exponentially and many Chinese are now saying with price increases there is no way they can own their own home. The best options exist outside of Beijing and Shanghai where these markets are reasonably saturated.

However you decide to invest in China it must be remembered it is not an entirely free market. While growth and consumer demand are increasing the level of power the Chinese government has not disappeared. - 23222

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