Don't Be a Victim of 'China-Phobia'

Editor's note: Steve Sjuggerud knows more about China than anyone we know...

So when he's making a major call about the country, we pay attention. Steve was one of the first people anywhere to boldly – and correctly – predict that index provider MSCI would begin adding Chinese stocks to its global indexes... setting up massive profit opportunities.

Right now, he believes most Americans suffer from "China-phobia." But as he explains in today's Masters Series essay – previously published in our free DailyWealth e-letter last November – you shouldn't let that cloud your judgment when the opportunity arises...


Don't Be a Victim of 'China-Phobia'

By Steve Sjuggerud, editor, True Wealth Opportunities: China

"My American pride took a real hit on this trip," a friend told me on our most recent trip to China.

"What was it that got you?" I asked him. It was his first time visiting the country.

"It wasn't one thing. It was... everything," he said.

"We are in what is supposed to be a third-world, communist country," he explained. "So my expectations were low. But Beijing and Shanghai are like stepping into the future. And I just did not expect that, coming from America."

I think his sentiments get right to the heart of the matter...

Americans feel that China is the first real threat in decades to our belief in American dominance.

We fear what we don't know... and what we don't understand.

We fear China. We have sort of a "China-phobia." It's some mix of fear and respect.

And hey, if most Americans feel this way, that works out for us as investors – because investing is all about fear and greed...

"Be fearful when others are greedy, and be greedy when others are fearful," billionaire investor Warren Buffett says.

Right now, most American investors are fearful of China. So we want to be greedy (once we have the uptrend too, of course).

Investor fear about China means folks ignore big important news. Like they did last year... when global index provider MSCI announced its latest plan for including even more Chinese A-shares in its benchmark indexes.

The MSCI story is the big reason behind the opportunity in Chinese stocks. In 2018, for the first time ever, MSCI started to add stocks trading in mainland China (called "A-shares") to its indexes.

Now, MSCI wants to increase its weighting in Chinese A-shares by a factor of four. (That's right... a fourfold increase.)

This was big news. But no one cared. No one was paying attention.

MSCI's latest change could mean around $66 billion worth of inflows into Chinese A-shares.

Our timeline for making money based on this big idea has moved up due to this major update from MSCI. And the long-term opportunity is stronger than ever. Hundreds of billions of dollars will flow into Chinese A-shares as this story plays out.

Yet even though news like this keeps coming out... most Americans don't want to hear it.

It's China-phobia – pure and simple.

If you own any China investments, you probably know exactly what I mean... especially if you've tried telling your family and friends about your investments.

Americans just don't want to hear about the opportunity in China. And as investors, we need to be greedy when others are fearful.

Of course, we need to follow the trend, too. Chinese stocks fell for most of 2018. So we need to wait for the uptrend before putting new money to work.

But when it comes, don't let China-phobia fog your vision.

The long-term opportunity in China is massive. It's a trend you need to own once the current bust turns into a boom.

Good investing,

Steve Sjuggerud


Editor's note: Steve just put together a presentation that explains exactly what's going on with Chinese stocks... and all the implications for investors as a rare event unfolds this year. He believes a select group of stocks could give you a shot at doubling – or potentially even tripling – your money as this situation plays out. Watch the presentation right here.

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