There are times when you get caught by surprise, there are times when you get dazzled by the headlights but you know something is coming then there are times when you see the smoke signals in the distance and there is plenty of advance warning. Chinese REITS are of the latter ilk. In fact the whole Chinese Stock Market at 37 times earnings seems to represent a giant bubble.
The acronym BRIC (Brazil, Russia, India, China) has been the road to profit for many investment managers but this all looks set to change. The growth in developing markets has attracted speculative money, and lots of it, China would be the most extreme example of this, their largest companies are now ranked in the top ten in the world (by market capitalization), as far as I am currently concerned now is the time to pull out.
Since the beginning of November Hong Kong property stocks have fallen 40% mostly in the area of REIT’s.
[REIT’s: This stands for ‘Real Estate Investment Trust’, this is an investment vehicle that is used for …