From Asia Financial: 2024-05-22 05:22:41

Global hedge funds have been increasing their holdings in Chinese equities in anticipation of a market rebound. Goldman Sachs reported hedge funds bought Chinese stocks in seven of the past eight weeks, with MSCI China up 16% this year. Some investors are buying call options to capitalize on the rally.

Despite China’s efforts to boost market confidence, not all investors are convinced of the recovery. New York-based hedge fund Indus Capital remains underweight on China due to ongoing economic challenges. Indus Capital’s managing partner cited deflation pressures as a reason for their cautious approach to Chinese stocks.

China has seen unexpected stock market outperformance this year, with the Hang Seng Index up by a third and the MSCI China index up 16%. Goldman Sachs has raised price targets for both indices, while some hedge funds are betting on further gains through call options. China’s recent economic stimulus measures have aimed to support the struggling housing market.



Read more at Asia Financial: Hedge Funds Build Holdings in Underpriced Chinese Equities