Investing in Chinese stocks

At least in the past (and maybe still), The Fool has recommended investing in certain Chinese companies’ stocks. I am wondering if The Fool considers the fact that the Chinese government is a repressive one, and one that is bent on seeing (and seeking) the destruction of democracy in the U.S. Today, I read that China’s official government policy is that its people view Russia as the victim of Western oppression. The Chinese government has had every opportunity to denounce its new best friend in Moscow, but it refuses to do so. In fact, it does just the opposite. My problem with investing in Chinese companies is that the Chinese government has its hand in the governance of all of these companies. Should The Fool continue to recommend that its members invest in Chinese stocks under these circumstances?

Hi, Riverrunner.

Generally speaking TMF tries to focus on the quality of a company’s business operations and not get tangled up in political trip wires. That said, any time you invest in a Chinese company, or any foreign company, you have to recognize that they do not necessarily hold to the same standards as US companies.

For many Fools, there is a philosophical barrier to investing in China for many of the reasons you noted. While TMF may recommend company on its fundamentals, it remains up to each individual Fool to decide whether it belongs in your portfolio.

I’ll note that China is not the only country that has refused to denounce Russia for its invasion of Ukraine, and there are usually quite a few layers of meaning to Chinese diplomatic statements.

Who tries to strike a balance in his own portfolio between the risks of investing in a Chinese company and the potential benefits of investing in a well-run company…

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