"The Chinese Stock Market: from Ugly Duckling to Beautiful Princess"
(A talk by Dato' Cheah Cheng Hye - of Value Partners Group)
Introduction
This is the final part of my three part series of articles on the London Value Investor Conference 2015, held at the QE Centre, opposite Westminster Cathedral, organised by Metropolis Capital.
I was particularly keen to attend this session on the Chinese stock market, as the recent history of smaller Chinese stocks listing on AIM has been, let's be honest, disastrous. Not just AIM either - numerous Chinese companies listing overseas have turned out to be outright frauds. Hundreds of them. For this reason, my opinion in my morning reports here on Stockopedia has, for a couple of years, been that Chinese stocks on AIM should be treated as uninvestable. All of them. People who took heed of my warnings have avoided numerous banana skins, as one by one they are collapsing.
This got me thinking. China is the world's second-largest economy, and has underdone an utterly astonishing period of growth, which has transformed it from, just a handful of decades ago, a desperately impoverished, agricultural sleeping giant, into now the world's manufacturing powerhouse.
So, whilst they might list their junk (geddit?!) on AIM, there's clearly a lot more to China than has so far met the eye of a UK-based small caps investor such as myself. So I very much went into this session with an open mind, and hoping to learn more about China.
The Speaker
Called Dato' Cheah Cheng Hye, of Value Partner Group, the speaker began by telling us who he is, and his background. His firm is listed in Hong Kong, and has built up an impressive $17bn FuM. Their performance has been strong - which he stated has been 17.2% p.a. compound since 1993, compared with 8.6% p.a. compound on their benchmark, the Hang Seng.
Before fund management, he spent 17 years as a journalist, and witnessed at first hand the economic miracle going on in China.
To give a little idea of the style of this talk, Dato' spoke fluent English, but with a heavy oriental accent, so at first I found him quite difficult to understand, but I quickly adapted, and soon found his delivery both modest and quirky, as well as good-humoured. So within minutes he had the audience eating out of his hand, in what was a charming, and often very amusing talk.
As…
