It is always a good time to look for an alternative investment. Especially when doubts assail the more traditional financial markets. In this sense, one of the most original proposals and innovative at the same time, is what makes up the technological values of the People's Republic of China. They are constituted in a really aggressive bet, but with which you can achieve a return on savings over other more conventional options. However, the risks involved in your operations are also much higher than usual.
This is a segment still unexplored by a large part of small and medium savers. And that to a large extent, it can be formed as a complement to the main investments that you are going to develop from now on. Because in addition, the offer you have of these values is very wide. More than you can detect in western equity markets. You can't forget that China is a paradise for this class of listed companies. That is, for the technological and last generation. Perhaps even more powerful than the US equities that are represented by the Nasdaq index.
China's tech stocks are already present in some of the most aggressive investor portfolios. Low percentage that fluctuate depending on the approaches of these people. There is, of course, no homogeneous strategy to operate with these very special and emerging values. But on the contrary, you can manage them from different methodologies and always taking into account which is the degree of losses you can bear from now on. Because it is completely true that you can leave a lot of euros on the way in any of these operations.
Why technological values?
Its level of acceptance is linked by the high potential for revaluation that its shares may have from now on. Since much more than through the more conformist values of the financial markets. Such is its tendency that many management companies have turned their eyes towards this unique financial asset for many of the stock market users. One of these cases is represented by the financial manager Saxo Bank which has decided to increase its exposure to the powerful Chinese technology sector. To the point that they see it right now as a clear buying opportunity. So that you can make the savings more profitable than up to now.
Well, Saxo Bank considers that its absolute recommendation for investors in the developed world. Among other reasons, because it is the one that is subject to the least regulation and has a surprisingly private nature. But it is not the only reason to position yourself in these most innovative values. Since another of the motivations to support this recommendation is based on the growth that this Asian country is experiencing in recent years. But above all, caused by the enormous momentum of the new economy China supported by services and domestic consumption.
In this new scenario, it cannot be forgotten at any time that the blows of the 2016 credit expansion seem to have been overcome. And from now on they can become a new starting point to promote economic development at all levels. And there is no doubt that one of the sectors that can best capture this scenario is that represented by technological values. More than in financial groups, insurance companies or even industries. From this perspective, there will be no choice but to be present in the values of these characteristics of Chinese equities. Although with a degree of involvement, depending on the profile you present as a small and medium investor: conservative, intermediate or aggressive.
What products can be contracted?
Another of the approaches that you should make from these precise moments is from where to invest your savings in Chinese technological values. Because you are not only limited to a financial product, but to several and of diverse nature. It is true that the simplest way is materialized through the stock markets. Although they are listed in China, operations can be formalized from your usual bank. But of course with more expansive commissions than in buying and selling operations in traditional or more conventional equity markets.
From the Asian stock market you will have a more than appreciable offer of technological securities. It is a series of proposals that offer great liquidity. Due to the strong capitalization shown by these listed companies. With a continuous exchange of buying and selling every day. In what is conformed as one of the highest economic operations of all international financial markets. And that you can carry out from these very moments and without excessive problems to execute orders in the equity markets.
ETFs based on these assets
But not only do the values of these characteristics live on the stock market. You can also opt for exchange-traded funds or better known as ETFs. This peculiar financial product is characterized by combining the purchase and sale of shares on the stock market with investment funds. Being, in any case, a very useful alternative for this kind of special investment. Acquiring index positions through ETFs is a good strategy for most. But as long as they know how to operate with these kinds of financial tools. Because negative effects can be very dangerous and also numerous.
In this specific case, they are designed for terms of permanence situated at a short and medium level. As a one-time investment for a specific moment in the absence of business opportunities in other financial markets. Not on a regular basis since then you can have many problems that can affect the balance of your checking account. Therefore, ETFs should be given the treatment these investments deserve. You cannot assimilate it to stock market operations, or even to other products, such as investment funds. Not surprisingly, you would be facing an investment clearly differentiated from the rest.
Strengthening of the Chinese economy
Of course, there are other reasons why you can opt for Chinese technological values from now on. From approaches to the good evolution of the economy of this important Asian country. Within this context, Saxo Bank analysts point out that during the past year China experienced a growth higher than expected. But the most important thing they say is that at the end of the process, China will emerge as an open and stable world economy, with strong trade ties with East and West. This factor should drive the share prices of these stocks we are talking about.
It should also be borne in mind that China's economy may replace that of the US as a global superpower in the coming years. In this sense, its flexibility is much greater than that detected in the countries of the euro zone. With a capital flow that is increasing year after year, in some cases in a spectacular way. To the point that many Chinese companies have already established themselves in those of the old continent. In a progressive, powerful way and with objectives not yet imagined by a large part of the financial agents. In Germany, France, Italy and even in Spain itself. It is something that you should count on from now on if you want to make profitable operations that you do from now on.
Tips to position yourself
Of course, this strategy will not be easy, nor will you have to provide a series of balances to protect your positions. Among which are these that we expose you below.
- In all cases you must have higher risks in operations. For this reason, you must apply more security measures in each of them.
- They will not be operations for very long deadlines, of course not. Rather, they will be limited to very specific actions with an expiration date.
- Do not spend a lot of money on each of the operations. But on the contrary, a minimal part will suffice as to satisfy this demand be special.
- You must make a much deeper tracking of its evolution in the equity markets. So you can cut any strong downtrend that may develop.
- It is much better to opt for this investment from other alternative products. As for example, mutual or listed funds. Not surprisingly, they have greater diversification in financial assets.
- You can not forget the risks you run with the technological securities that are listed in China. For this reason, you will have to apply a loss limit order to preserve your capital above other technical considerations.
- It is an excellent alternative if the general trend of Chinese indices is clearly positive. If this is not the case, it would be better to opt for other values and other geographical areas to attend to your operations. It is the best you can do in these cases.