Editor's note: Stories of doom and gloom about China are all over the news recently...

As regular Digest readers know, the trade war with the U.S. has escalated again. Many folks fear the latest tensions will lead to big losses for investors in both countries.

But our colleague Steve Sjuggerud just returned from his latest weeklong trip to China. And he sees a much different picture than the one you're hearing about in the mainstream media right now.

So in this weekend's Masters Series, we're focusing on two of Steve's major themes that the media and Wall Street are playing catch up on. In today's essay – adapted from the February issue of True Wealth Opportunities: China – Steve explains why the impact from one of these ideas could be much larger than even he originally imagined...

How Not $1 Trillion – But $2 Trillion – Could Flow Into Chinese Stocks

By Steve Sjuggerud, editor, True Wealth Opportunities: China

What I'll share with you today is a major development in our "MSCI story"...

I've said for years that as much as $1 trillion should flow into Chinese stocks over the long term, all because of the MSCI story.

The first step happened in 2017... Global index provider MSCI announced a plan to include locally traded Chinese stocks (known as "A-shares") in its emerging markets index.

Then, in the summer of 2018, the first trickle of this huge flow of money started going into A-shares.

The story could have stopped there... We would have been on track to see as much as $1 trillion flow into the Chinese stock market over the coming years.

But now, the next hugely important piece of this story is here...

Interestingly, it wasn't an announcement from MSCI or any other index provider. It didn't come from the Chinese regulators, either.

No, this came from somewhere else... Wall Street.

The folks on "the Street" have consistently been behind on this story. But they're finally catching up.

Our story has gone mainstream. The big idea is out there. People are beginning to hear about it... and understand just how big the opportunity in Chinese A-shares really is.

Even more important, Wall Street says my initial projection of $1 trillion flowing into Chinese stocks could be low... very low.

We could actually see as much as $2 trillion flow into Chinese stocks over the next decade.

This is huge news. And it gives us a fantastic opportunity to profit.

So today, we'll cover this next important step in our MSCI story. It began with a cryptic headline that nobody paid attention to – except us...

"China A-Shares Will Be One Tenth Foreign Owned in Ten Years: MS," the headline on Bloomberg said earlier this year.

It wasn't even really a story... more a list of bullet points about a research report from the investment bank Morgan Stanley.

But the first bullet point floored us.

Why? Because it said a total of $2 trillion could flow into Chinese A-shares over the next 10 years.

Here's the exact quote:

Morgan Stanley sees foreign ownership of China A shares reaching about 10% in 10 years from the current level of 2.6%, with annual A-share inflows normalizing at around $100bn-$220bn.

Over 10 years, $100 billion to $220 billion in annual flows adds up to a maximum of $2.2 trillion.

Up until this point, the big U.S. investment firms have been nearly silent on this subject.

While we've covered the MSCI inclusion in detail for years – before it was even a done deal – Wall Street has been a step behind.

Now, it's finally catching up.

Morgan Stanley is giving specifics on what it sees for the coming shift in Chinese A-shares. That's important for two reasons...

1. It means our story is finally becoming more mainstream in the investing world. The general public will soon be on board with the ideas we've known about for years.

2. The dollar amounts Morgan Stanley believes will flow into China are larger than even I believed possible.

In other words, Morgan Stanley told the investing world earlier this year exactly how big this shift is going to be. Here are a few more of the bullets from the Bloomberg story...

• Morgan Stanley sees a "2019 target for a record $70b-$125b of inflows" into A-shares.

• It believes Chinese A-shares will be fully allocated into global indexes by about 2027, specifically saying it "sees MSCI's A-share inclusion factor reaching 100% in the next 5-8 years."

• Again, it expects that after this year, the annual foreign A-share inflow will be $100 billion-$220 billion per year, over the next decade. That means well over $2 trillion could flow into Chinese A-shares.

That's absolutely huge. It's more than double what I'd initially believed possible based on this shift from MSCI. But it's what Wall Street believes now.

Morgan Stanley also expects foreign ownership of Chinese A-shares to quadruple over the next decade – from 2.6% today to about 10% – according to the Bloomberg story. That's the amount investors outside of China will own.

So what does all this mean?

Simply put, it means the floodgates are open...

We're in the early stages of an unstoppable trend. It's one we've covered – and profited from – for years. Now, Wall Street is finally latching onto the story.

This is huge news. And it gives us the perfect opportunity to put new money to work right now.

As I've said for years, we know a flood of money is heading into Chinese A-shares... So let's get our money there first.

I believe we will see a triple-digit gain within an 18-month period sometime over the next five years, thanks to the shift Morgan Stanley sees coming.

And that's likely a major understatement. China has a history of soaring hundreds of percent quickly... And a couple trillion dollars in inflows is the kind of thing that could kick off a frenzy.

Of course, we can't just blindly hold A-shares for years while the shift occurs. That's too risky, considering how extremely volatile Chinese stocks tend to be.

What we want to do is be invested when the uptrend is in our favor... and step aside when things get tough.

Our idea is finally "going mainstream" on Wall Street, thanks to Morgan Stanley. The total flow into Chinese A-shares could be larger than we ever imagined.

The result is simple. It's time to buy in China.

Good investing,

Steve Sjuggerud

Editor's note: In recent weeks, we've received many questions about what the trade war between the U.S. and China could mean for investors. So Steve has decided to hold an emergency briefing on Thursday, May 30, at 8 p.m. Eastern time to go over it all...

During this free event, Steve will share his latest thoughts on the situation... including brand-new details from his trip to China this month. And he'll even give away the name and ticker symbol of an investment he believes will soar following the trade war. Reserve your spot right here.