Not all parts of China’s economy are created equal.
While Hedgeye’s macro team has been warning about #ChinaSlowing since Q3 of 2017, our call has been primarily focused on “Old China” primary and secondary industries. The Shanghai Composite broadly has been a terrible place to have your money this year.
It’s a different story with Chinese tech companies.
“I actually quite like the consumption story in China, because you’re just talking about building on very low per-capita GDP consumption levels,” Hedgeye CEO Keith McCullough explains in the clip above.
Are we bullish on Chinese tech? No. “There have been plenty of great Chinese stocks on the consumption side. My general problem with those is that I’m so bearish on China overall, that I think thematically, China’s for sale in people’s portfolios.”
So while Chinese tech companies are not staring down the “wicked difficult comparisons” of Old China, as McCullough says, we’re staying away from Chinese stocks entirely.
Watch the full clip above for more.