r/baba
Market is being officially stupid on China stocks (again) - receipts in post.
Author argues market undervalues China stocks due to strong reserves, but advises buying US AI stocks over BABA.
- China has massive reserves and the government can protect consumers longer than other countries.
- The Chinese government is expected to follow the US in heavily investing in AI, benefiting BABA.
- Chinese institutions are also selling, indicating a lack of domestic confidence.
- Author explicitly advises against increasing exposure to BABA, preferring US AI stocks.
I made a similar post on BABA at the lows 3 years ago https://www.reddit.com/r/baba/comments/16kc6xv/bull\_case\_for\_hsi\_and\_baba/
Basically same thing is happening the market seems to think that the USA is the least affected with strait closed completely ignoring that China literally is sitting on 1 Billion + in reserves. This time though Chinese institutions have also been selling. I can't time the exact "Eureka" moment when China and then the rest of the world put a premium on Chinese stocks given that the CCP can protect the Chinese consumer longer than the rest of the world can protect theirs.
But as I said 3 years ago if I figured this out the rest of the market will do so as well in short order.
P.S. Trump is saying that the USA will invest in AI companies ... Xi will follow suit in BABA. But probably best to buy USA AI names as opposed to increasing exposure in BABA.