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Carmignac: Is 2023 the year to add China to your core allocation?

Carmignac: Is 2023 the year to add China to your core allocation?

China's financial markets experienced high volatility recently due to a regulatory crackdown, geopolitical tensions, and an economic slowdown triggered by a draconian zero-Covid policy. But 2023 – the Year of the Water Rabbit, a symbol of peace, a return to normal, and more – could open up a new chapter for Chinese equities and usher in plenty of opportunities, particularly in consumer-oriented sectors.

Chinese stocks delivered solid returns in 2020 but then fell sharply in 2021–2022 on the back of several policy decisions and other developments that fuelled foreign investors’ anxiety. These included tighter regulations for certain industries, the financial woes of real-estate giant Evergrande, and stricter transparency requirements for Chinese companies listed in the US. Not to mention Beijing’s strict zero-Covid policy and fears that China would invade Taiwan in the wake of Russia's invasion of Ukraine.  Read more >