Jens Ehrhardt: I'm still bullish on China
Asia remains more attractive than Europe and US as its stock markets remain undervalued, says renowned German investor.
by Emily Blewett on Jan 22, 2013 at 10:47
Jens Ehrhardt, one of Germany's most renowned fund managers, said that he believes in the Chinese recovery and is focusing on Asian stocks in the financials and income sectors.
Despite better macro economic figures from China since the year begin, many investors have remained bearish on the region and the extent of a recovery to past double-digit growth figures remains disputed.
However, the founder of DJE Kapital AG, that oversees €10 billion in assets, remains bullish on Chinese stocks across his portfolio of multi-asset funds.
'Consumption in China has recently increased by 14% and companies are seeing profit increases of around 20%,' Ehrhardt, who also manages funds for Gamax Management AG, said.
His latest comments echo views he voiced in October last year when he said Asia offered value for money in key sectors.
Chinese stocks underperformed in the last quarter of 2012 but have benefited since the beginning of the year on improved investor sentiment.
Due to an uncertain outlook in the European economy and the continuing relative strength of the euro, Ehrhardt is looking for comapnies that have promised strong dividends.
He said he is also looking to buy financial names, especially fund management firms, that will outperform on the sector's upside potential.
The Chinese stock market, which is partly closed to foreign investors, will continue to mature and develop and shrewd investors can benefit from this, according to Ehrhardt.
'The international financial community still remains underinvested in Chinese stocks and there is no reason why the equity market there shouldn't develop in the same way as western stock markets,' he said.
'In the long term, the experienced portfolio manager will look at China as more promising than the US and European markets.'
Ehrhardt runs a number of equity and bond funds for his own firm, including the DJE Absolut, DJE Renten Global, DJE Invest Lux Select and FMM Fonds. He also runs a large number of funds on third party mandates.
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