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Why passive may be best way to capture China’s coming bull market
by Robert St George on Dec 04, 2013 at 11:50
This view is that the suite of reforms will prompt a ‘substantial’ mean reversion in state-owned enterprises’ currently depressed valuations, which Ventre feels will produce a bull market lasting between 18 months and two years in such stocks. ‘Active managers will struggle to keep up with that.’
Ventre emphasises that that is just a tactical trade, though. ‘Our general thesis is that the best way to build long-term shareholder value is not to invest alongside the state.’ He thus has no intention of embarking on a parallel move in Russia, where the government has proffered no such positive indications about the outlook for its similarly shunned national champions.
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