Canada's Investing Secrets I Learned in Calgary
Stock-Markets / Canadian Stock Market Oct 30, 2007 - 08:23 AM
Tony Sagami writes: Woody Allen was absolutely right when he said "80% of success is just showing up." And nowhere is that more true than the world of investing.
I regularly find myself dodging forklifts on busy shipping ports … walking past snarling street dogs in Chinese alleys … or, in my latest trip's case, freezing my buns off in northern Canada.
Reason: There truly is no substitute for seeing things with your own eyes. Plus, sometimes you'll be lucky enough to find out even more than you planned on.
Let me give you an example from my trip up to Canada to investigate the country's rich tar sands …
The Canadian Investing Secret I Learned in a Calgary Starbucks
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| Calgary was not only modern but also extremely diverse! |
On my way up to Alberta, I stopped over in Calgary. I expected a beautiful, modern, and rapidly growing city thanks to rising natural resource and energy prices. And that's exactly what the city turned out to be.
Of course, I also thought Calgary would be similar to my home state of Montana, which consists almost entirely of U.S.-born Caucasians. That's where I was dead wrong!
The city was amazingly diverse. It was full of immigrants from all over the globe. In fact, one out of every five of its residents arrived from a foreign country, including many Asian locales.
Heck, from all my travels, I've learned that you can gauge a city's population by its restaurants. And I had no trouble finding great sushi as well as places specializing in Chinese, Indian, Filipino, Thai, and Korean cuisines!
Later, I learned that Canadians' investment portfolios are just as diverse as their cities!
As it often happens, I came across this investing nugget completely by accident. I had stopped into a Starbucks to grab a cup of coffee when I struck up a conversation with two businessmen.
When we got around to talking about investments, they told me that Canadian investors stuff their portfolios with plenty of international stocks and funds.
Canadian investors, my new Calgary friends told me, often own more foreign stocks than Canadian stocks. In fact, they said investing in Asian companies was considered just as normal as investing in U.S. stocks!
As my new business buddies explained, Canadians are very aware of the investment action across the Pacific. That's especially true in Calgary because of the city's large Asian population. Talk around the water cooler often includes the huge profits being made in Indian and Chinese stocks.
I was still trying to soak it all in when one of the businessmen looked at me and asked,
"Don't American Investors Know How Hot the Chinese Stock Market Is?"
I hope the answer to that question, at least as it pertains to you, is "Yes!" After all, I've been telling you over and over again about the many great opportunities overseas.
But my talk with those guys up in Calgary made me realize that I can never drive home the point enough.
So, just in case you haven't been following the Asian markets too closely, I've prepared two important tables for you. First, I'm going to show you how well some Chinese stocks have been performing this year …
Ten Best-Performing Chinese ADRs |
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| Name | Ticker | Percent Gain |
| China Finance Online | JRJC | 689% |
| China Eastern Airlines | CEA | 351% |
| China Shipping Develop | CDSXY | 319% |
| JA Solar | JASO | 258%* |
| China Oilfield Services | CHOLY | 257% |
| China Southern Air | ZNH | 249% |
| Jiangxi Copper | JIXAY | 248% |
| Aluminum Corp of China | ACH | 230% |
| Ping An Insurance | PNGAY | 196% |
| Baidu.com | BIDU | 180% |
| Performance as of October 23, 2007 *Started trading after the start of the year |
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As you can see, many Chinese companies have racked up absolutely spectacular gains. Here's the best part — you wouldn't have had to leave the comfort of U.S. exchanges to buy any of them because they all trade as American Depositary Receipts right here!
And we keep getting more and more Chinese stocks to choose from. Here are a few examples of Chinese companies that have gone public on U.S. exchanges in just the last 12 months …
| Company Name | IPO Date | Percent Change from IPO |
| Longtop Financial Technologies | 10/24/2007 | 85.14% |
| China Digital TV | 10/05/2007 | 145.50% |
| WuXi PharmaTech | 08/09/2007 | 157.63% |
| E-House Holdings | 08/08/2007 | 123.18% |
| China Shenghuo Pharmaceutical | 06/14/2007 | 124.26% |
| Yingli Green Energy | 06/08/2007 | 175.09% |
| Trina Solar Limited | 12/19/2006 | 174.75% |
| Home Inns & Hotels | 10/26/2007 | 231.44% |
Now, I'm not showing you those IPO numbers to make you jealous. And not all Chinese IPOs have skyrocketed right out of the gate, either.
But at the very least, I think you should be like my new Canadian friends and take a more global approach. One way to do that is by dipping your toes into some of the Chinese ADRs that trade right here in the U.S.
Best wishes,
Tony
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